How 4 Broke College Kids Built The #1 Food Delivery Empire In The World.

When it comes to having food delivered to your doorstep, particularly if you live in a first-world country, you’re definitely not lacking in choices.

From GrubHub to Uber Eats, Skipthedishes to Instacart, the food delivery industry is a very crowded marketplace. So to make it big and beat out the competition, you have to be willing to make bold, calculated moves, otherwise you become a commodity.

By March 2019, a new kid on the block—DoorDash—did what seemed impossible. It overtook seasoned players to claim the largest share of consumer sales, grabbing 27.6% of the on-demand delivery market. Their playbook wasn’t flashy. In fact, it was downright scrappy. Four broke Stanford kids started DoorDash from a tiny room at Stanford with nothing but a website full of PDFs and some printed flyers.

They weren’t dreaming of Silicon Valley fame—they just wanted to solve one local problem: getting food delivered faster. What began as a side hustle in Palo Alto didn’t just disrupt food delivery—it redefined how we think about convenience.

In 2012, four Stanford students—Tony Xu, Andy Fang, Stanley Tang, and Evan Moore—were working on a side project, building a mobile app to help small businesses manage operations when a local macaroon shop owner asked if they could help her with delivery.

Seeing this as a huge opportunity, the friends quickly launched PaloAltoDelivery.com, which was the very first iteration of what is now Doordash. Now let’s remember, these were 4 college kids with no real job and no income, so when it came to getting their website into the view of others, glamour seemed far-fetched.

So they did it the old-fashioned way, flyers. They started small and local, printed flyers, and put them all over Standford University to target students and see if there was actually a demand for charging $6 a delivery with a website full of PDF menus of restaurants.

Not flashy at all, but it worked. By 2013, they received $120,000 in seed funding from Y Combinator, officially rebranding as DoorDash.

From the start, the founders framed their mission as more than just food delivery—they pitched DoorDash as a logistics powerhouse. “We’re building the local, on-demand FedEx,” they declared.

Their ambition extended beyond delivering meals. They envisioned a platform that empowered small businesses, offered flexible gigs for Dashers, and gave customers affordable convenience. The secret to their success lay in mastering logistics—seamlessly matching orders, drivers, and restaurants in real-time. This relentless focus on backend operations and engineering became their competitive edge, fueling year-over-year growth.

The beauty of DoorDash was of course that it was not among the first big players in the food delivery industry. Grubhub, Seamless, and Uber Eats were already deep in the game. But DoorDash played differently. The company wasn’t obsessed with just restaurants—it targeted suburbia and communities.

While big players like Uber Eats and Grubhub fought over markets in New York and LA, chasing Instagram-worthy restaurant partners. DoorDash zeroed in on Karen in Ohio, ordering wings for family game night. And it paid off. This suburban-first strategy let them fly under the radar, quietly building an empire while competitors slugged it out in crowded cities.

By 2018, they surpassed Uber Eats, and by 2019, they pulled off an even bigger upset, overtaking Grubhub to claim the top spot in U.S. food delivery.

The Major Turning Point For Total Takeover

When COVID-19 struck, as businesses scrambled to stay afloat, DoorDash became a lifeline—especially for local restaurants. Many leaned on the platform for survival, with DoorDash stepping up in ways that made a real difference.

While gloves, sanitizer, and contact-free delivery were helpful initiatives, the real impact came from their community-driven initiatives. Dashers affected by COVID-19 received two weeks of pay, and a “priority access program” welcomed laid-off restaurant workers, offering them a chance to earn income while their regular jobs were on hold.

To further support independent restaurants, they waived commission fees for new partners for 30 days and extended fee waivers for existing restaurants. This allowed struggling eateries to operate on the platform without worrying about delivery costs during a critical period. By extending a hand when competitors didn’t, DoorDash won not just business but trust—and from that point on, restaurants would be putty in their hands.

By making initiatives like this at a time when others failed to adapt and adjust to the troubled times, it’s pretty easy to see why they completely overtook competitors. By the end of 2020, DoorDash reported $2.9 billion in revenue and reached a valuation of $16 billion, solidifying its position as a leader in food delivery.

As of 2024, DoorDash boasted over 500,000 Partner Restaurants and 32 million users, with a market share of 65%. Their ascent to food delivery domination has been swift, though not without some bumps along the way. From accusations of withholding tips to a data breach in 2019, DoorDash’s history isn’t spotless.

However, it’s clear that DoorDash has learned from its past mistakes and used them to improve upon its service, offerings, and policies going forward — as well as solidify its brand image.

Here Are 3 Valuable Lessons You Can Take From Doordash:

I usually end with our infamous quote of the day, but today I want to do something different—something more valuable, especially if you're building a business, just starting out, or dreaming of launching one someday.

DoorDash’s story offers lessons that go beyond food delivery, and I want you to walk away with something you can use.

1. Relationships Will Save You When Things Go South

When everything falls apart, relationships—not money—are what keep you afloat. Whether you’re working with suppliers, customers, or partners, building meaningful relationships is essential. For small businesses, this might mean offering personalized service to build loyal customers. For larger companies, it’s about cultivating strategic partnerships to enhance your offerings.

The key here is trust. Relationships create a network of support that lasts, even when profits dry up. If your business takes a hit, the connections you’ve built will still be there, ready to help you bounce back. DoorDash proved this by prioritizing relationships with restaurants during COVID-19—earning loyalty that extended far beyond the crisis.

2. Embrace Technological Innovation Like Your Business Depends On It

Because it does. DoorDash didn’t just rely on food delivery—it became a logistics powerhouse through relentless focus on tech and operations. Whether you're a solo entrepreneur or running a growing business, investing in the right technology gives you an edge. For small businesses, this could mean creating a seamless website or app to improve customer experiences. Startups can leverage data analytics to make smarter decisions and fine-tune operations.

Innovation is a mindset, not just a tool. DoorDash thrived by continuously optimizing its delivery algorithm, making real-time order tracking a standard, and constantly improving its platform. Keep this in mind: staying ahead technologically ensures you stay relevant.

3. Be Flexible And Willing To Reevaluate Your Priorities

Adapt or get left behind. In today’s business world, flexibility is non-negotiable. DoorDash made bold moves during COVID-19—not by chasing profits, but by supporting restaurants and employees. This meant waiving commission fees and providing financial relief for impacted workers, demonstrating that their values were more than just marketing.

For smaller businesses, flexibility might mean shifting product offerings based on customer feedback. Startups may need to rethink their business models or target audiences. Like DoorDash, businesses that stay open to change can uncover opportunities others miss.

What I Want You To Take Away From This (Blue Ocean Strategy)

If there’s one thing I want you to learn from DoorDash’s story, it’s the importance of the Blue Ocean Strategy—the idea of creating new markets instead of fighting tooth and nail for a slice of the same crowded pie. DoorDash didn’t follow the herd into the same trendy urban centers as Uber Eats and Grubhub. Instead, it carved its own path, focusing on suburban neighborhoods that others overlooked, proving that sometimes, winning means building your own playing field.

This mindset isn’t just for business—it’s a life strategy. Whether you’re building a small online shop, launching a startup, or navigating a corporate job, don’t get trapped in the race for the same opportunities as everyone else. If everyone is competing for one promotion, why not explore an area where your strengths shine and no one else is looking?

Success doesn’t always come from winning the same game everyone’s playing—it comes from playing a different game altogether. The goal isn’t just to be better; it’s to be different. And in doing things your way—on your terms—you’ll ultimately do better at what sets you apart from the crowd.

DoorDash teaches us that sometimes, the best opportunities are in places no one thought to look. Be bold enough to build something uniquely yours—and let others chase the same tired paths while you create a new one.

As always thanks for reading.

Finance Vaults.