Doordash CEO Tony Xu is shortly after Will Shu, founder of UK-based rival Deliveroo, launched a food delivery startup at a San Francisco coffee shop over a decade ago.
“At the time we were two young founders who had the same kind of ideas,” says Xu.
Their ideas have led to different amounts of success. Doordash has become the US industry leader with market capitalization of over $110 billion and stock prices at record highs, with stock prices now growing wildly, and demand has not risen sharply during the delivery pandemic.
However, men who share their background as children of Asian immigrants to the US maintained a good relationship. This week it peaked with Doordash, completing its British rival’s £2.9bn acquisition, paying less than half of the £7.6bn delivery listed in March 2021.
Xu says he has sought a deal to bolster Doordash’s overseas expansion plans and bring his company to Britain and several other new markets in Europe and the Middle East. “You don’t have to grow your global business. You have to choose what you really want to do that. And now? We’re all here,” he says.
He told the Financial Times that the initial agreement with Deliveroo, announced this May, reached in “a few short weeks,” and was fleshed out during a trip to Shu’s favorite London pub and Notting Hill’s Michelin Starred Dorian Restaurant. “It made a lot of sense and we were encouraged to move quickly both sides.”
Due to US sales growth, Prosus, the European investment arm that acquired Europe’s largest food delivery group, acquired Europe’s largest food delivery group in February with a contract worth 4.1 billion euros. Doordash has acquired restaurant reservation platform, Seven Room and advertising company Symbiosys.
Xu must bring together the different parts of his business, put them together into a coherent global competitor, and answer investors’ questions about where growth comes from. “The big things for those guys are what comes next,” says the rival executive.
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Born in Nanjing, China in 1984, the family of Doordash’s co-founder moved to Illinois when he was four years old. The move followed after his father received the location of the University of Illinois engineering program. His mother gave up a career as a doctor to do three jobs, including restaurants.
“I was really raised by my grandmother for the first 12 years of my life, and I had a lot of free time to make my own decisions,” says Xu. “I don’t think my parents checked my report cards. They say this is pretty rare.”
Xu’s family moved to San Jose, California when he was a teenager. After graduating he worked for eBay with McKinsey. He met Andy Fan, Stanley Tan and Evan Moore, co-founders of Drudash, and earned his MBA at Stanford. They founded a restaurant delivery service for Palo Alto Delivery. This rebranded Doordash after acquiring a location in the Y-combinator incubator program.
In classic Silicon Valley fashion, they initially built their business from a home across the road from Stanford campus. His co-founder and early employee, Xu once napped in his sleeping bag on the floor, spending a tough schedule to meet orders.
Doordash received support from Khosla Ventures and Sequoia Capital before Softbank’s Vision Fund led the $535 million investment round in March 2018. It overtook Uber’s meals and then overturned its biggest rival, Grubhub, changing its first operating profit in 2024, but became the largest food delivery app for sales.
The former Uber executive said: “I think you’ll tell yourself you’ve never really thought about other platforms, but I’m always worried about Doordash.
Andrew Munday, Doordash’s first full-time employee and former director of operations, says he has decided that Xu is in “all details.” He recalls that Doordash’s chief often reads the metric early before firing texts to various staff members. “I’ve come to know more about it.”
One way Xu collected data on how business functions work was by delivering personal delivery and handling customer support.
“Operating at the lowest level of detail is a requirement for this business, and that just happens to be the way I wired it,” says Xu. “It’s also what’s needed to actually build scalable technology for the physical world.”
Xu also believes that spurred his decision to cut fees for independent restaurants during the pandemic, making his family history aware of the demands of small business owners. “It was a decision made in minutes,” he says. “It’s not that someone at Doordash is losing their job. This is someone who has lost their identity and probably never recovered.”
One of the controversies during his leadership was when Doordash was forced to backtrack after using tips paid to “dash” (what he called gig workers) to compensate for the revenue promised to the driver rather than paying as a bonus. Xu admitted that this policy is incorrect.
Deliveroo also faces scrutiny over the treatment of gig workers after it turns out that undocumented immigrants are borrowed or rented accounts from riders to work illegally. The company joined Just Eat Takeaway and Uber Eats to partner with the government this summer to curb practices, but the problem still exists.
Xu recognizes the challenge of making trading work. “Because M&A performance is largely littered with obstacles, why does my ongoing views on M&A become different for us,” he says. “The bar remains very high.”
“I can’t do that because it looks good on paper or Excel models. For me, can I do it against it?”
He is encouraged by the integration of Finland’s Wolt, a company that acquired it for 7 billion euros in 2021, expanding the business to nearly 20 new markets. Revenue from international operations rose by over 50% in 2024, significantly faster than about 20% in the US. Revenue growth has increased in June from the most recent quarter, with the company citing a rebound in the US order.
Xu and Shu are currently heading separate paths, with Deliveroo’s CEO resigning after 13 years of running the business. He is replaced by Miki Kuusi, the international head of Doordash and co-founder of Wolt.
“We believe in a culture of individuals who are directly responsible,” says Xu. “If you’re a lead, you make the final call. It requires trust. It also means making mistakes possible, allowing them, allowing them, and moving forward.”
Kuusi says Xu is focused on maintaining “startup level strength” as Doordash chases global market share. “It’s still very early because of our international journey.”
Investors and others in the industry are questioning the extent to which DERERDOO’s trading boosts Doordash. Former industry executives say they are skeptical about whether profits from Wolt differ from Derveoo. “It was really the only option left,” they said of the latest acquisition.
Xu told investors during a revenue call in May that it taught the business that the acquisition of WOLT could “generate large investment returns.” He looked at the possibility of introducing new products, including premium subscription services.
For him, skepticism about Doordash’s ability to get out of Deliveroo brings out of the mirror out of the early doubts about his ability to make money as he chases Wall Street’s growth. “If an investor is trying to do what he wants to do, you can do that. You can do that, everyone has the right to do that,” says Xu. “That’s not how Doordash runs.”
Tony XU’s Day of Life
6.00am-7.00am: I usually get 7-8 hours of sleep. I am the father of two young children, ages 7 and 5. So when I’m in town I cook breakfast, prepare, and drop it off at school.
Morning: When I’m not traveling, my day is spent meeting various offices and customers in the Bay Area. I’m going to train. Training is what you get in when you get in. Consistency hits strength.
Lunch: Usually quick at meetings. Sometimes I go out for walks with my team and grab something.
Afternoon: I spend my time on two different kinds of projects. These are what you need to land this year and what you need to arrive five years later. This includes a new four-wheel autonomous robot named DOT, which the company announced last month.
Evening: Try going home for family dinner. Make something with your daughter on Sundays. I don’t watch TV.
