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Uber Eats Unveils New Payment Options: SNAP, EBT, Healthcare Benefits
Instacart IPO takeaways, Texan food favorites, TikTok's holiday discounts
Hey, does anyone have Apoorva Mehta’s email address? Now that the dust has settled from yesterday’s Instacart IPO, we figure the company’s founder has a whole lot more time on his hands (and about 1.1 billion new reasons for folks to suddenly be his friends…)
Uber Eats Launches SNAP, EBT, Healthcare Benefit Payments
What We Learned from Instacart’s IPO
Chart Time | Which Foods Texans Favor
TikTok’s Holiday Candy Shop?
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3PD | Uber Eats Unveils Slew of New Payment & Ordering Tools
Uber is rolling out a handful of product updates to make it easier to order delivery, all while allowing customers to tap into new payment sources. First, Uber Eats will allow qualified recipients to pay for food with SNAP / EBT, improving access to nutrition for seniors as well as lower income and disabled individuals. The company is also unveiling a “Sales Aisle” — where promos and deals will be prominently grouped. The company also confirmed its building an AI-powered shopping assistant, which users can ping to help meal plan, get recipe instructions from or use to find sale items.
The Big Picture: The biggest differentiator in Uber’s announcement is the launch of healthcare benefit payments, an industry first. Users that have Medicaid or Medicare Advantage plans will be able to pay for certain items — like transportation to and from grocery stores, as well as pick-up and delivery for grocery orders, and some OTC healthcare products — with FSA Cards, Flex Cards, and relevant waiver payments. Tapping into this funding stream gives Uber a leg up on the competition, whereas the SNAP / EBT announcement catches it up with something Instacart has offered for some time. Also note that sleuths first discovered evidence of the chatbot back in August.
FINANCE | It’s Day Two For $CART
Well, after we sent yesterday’s newsletter, Instacart’s freshly public stock sank a bit back down to earth, closing out Monday at $33.70, up 12% from the opening price but down from the intraday high of $42.95. The company raised a total of $660 million, of which $237 million went to investors who sold their shares via the offering. Note that small float of 6.7% for a company now worth about $10 billion, which showed that Instacart was feeling cautious about the market’s appetite; it’s using 84% of the cash it brought in to pay the taxes it owes for employee stock grants.
The Big Picture: Right before we hit send, the company’s stock is sitting right below the bubble of $32, the price it listed at yesterday. So while the company only ended up adding about $100M to its balance sheet after everything else, other folks certainly came out as big winners. Andreessen Horowitz shares what attracted it to the company; the VC invested in the Series B (at a $356M pre-money valuation) because partner Jeff Jordan (previously CEO of OpenTable) liked how the four-sided marketplace tackled the largest retail category in America. And while he might be stepping down from the company’s board, founder Apoorva Mehta will be alright — he’s walking away with a cool $1.1 billion, as long as that stock doesn’t drop too much further…
CHART TIME | Everything’s Hungrier in Texas
Texas-centric deliverer Favor published some delicious statistics, revealing the culinary preferences of the rootin’, tootin’, book-bannin’ Lone Star State. While it’s not shocking to hear that Dallasites like barbecued brisket on their tacos, we’ve got to wonder about Austin’s love of shrimp; are you pulling those critters out of Barton Springs? Among other stats about meals and food types, the report also reveals that Favor has 100,000 “runners” (delivery workers) and has made 80 million deliveries since launching 10 years ago.
ECOMMERCE | TikTok Pushes Holiday Discounts to Compete w/ Amazon
Social media star turned shopping app TikTok is cranking up the pressure, as it looks towards the holiday season as its big chance to become a go-to source for shoppers on its newly launched marketplace. Hoping to out-discount the likes of Walmart and Amazon, the app is enticing merchants by subsidizing sale prices by as much as 50% for its Black Friday promo, which will run from 10/27 to 11/30. Coupled with existing offers like free shipping and 20% off coupons, the company is hoping to rake in $20 billion in merchandise sales globally; it already counts 200,000 verified US merchants, with beauty as the largest category.
The Big Picture: Before merchants rush to this new source of shoppers, they should heed the warnings of others on the platform. Take the tale of freeze-dried candy, which has emerged as a popular concept due to viral videos of folks eating distended looking Skittles in the latter days of the pandemic (what a world we live in…) Some specialized candy merchants found they could sell 1,400 orders per month by tapping into that craze, only to suddenly see TikTok deactivate their stores, or rework the visibility algorithm, and drive them out of business.
A Few Good Links
Judge denies motion to dismiss in NYC delivery fee cap lawsuit, rules its plausible city devised fee with hostility towards 3PDs. Panera Bread debuts one-swipe ordering via first party app. Amazon invests in DSPs, including child care services. Uber Eats adds Staples to platform. Amazon asks sellers to send in Black Friday inventory earlier. Canada’s Gordon Food Service partners with Toast. Amazon debuts version of Just Walk Out tailored for clothing stores. Bird acquires Spin. Ex-Yellow executives land jobs at Valley Companies. Taco Bell tests energy drinks. Port of LA sees first volume increase in 13 months.
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