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Sidecar CEO Sunil Paul.
Sidecar CEO Sunil Paul.

Sidecar is no longer just getting people from point A to point B — the company is delivering packages now, too.

The San Francisco-based startup announced a new service today rolling out nationwide called Sidecar Deliveries. For the past six months, the company has been testing a same-day delivery program in the Bay Area built on the mobile-based technology and independent drivers that already power its traditional on-demand transportation app.

“If you’ve taken a ride in San Francisco lately, there’s a good chance there was a passenger in the trunk — a package!” CEO Sunil Paul noted in a blog post.

Sidecar has been working with e-commerce, food, flower, and grocery companies to deliver items at a price point that is “80 percent cheaper than traditional services” and in half the typical delivery time, according to Paul.

sidecar-deliveries_header-blogSame-day delivery already represents 10 percent of Sidecar’s total ride volume in San Francisco. This is clearly a huge move for Sidecar, which has big ambitions for the new service. Paul said that Sidecar Deliveries will represent half of the company’s business by the end of the year.

“Our vision is that one day any business will be able to take an order and get it to the customer in an hour, and Sidecar will be the service that powers this capability,” he wrote.

Sidecar noted that drivers earned 75 percent more income when they had both people and packages in their vehicle.

Sidecar's Shared Rides feature.
Sidecar’s Shared Rides feature.

“Riders also reap the benefits of this people and packages combo because there will be more drivers available, lower wait times and even lower prices,” the company added.

One of Sidecar’s pilot partners is Eat24, the food delivery company that just dropped more than $4 million on a Super Bowl commercial. Sidecar said it helped reduce Eat24’s delivery time in half, while restaurants saw “double the revenue” when Sidecar drivers delivered their food.

Sidecar is certainly not alone in the delivery space. Uber, for example, has tested a drug store delivery service, however it recently decided to stay out of the grocery delivery market for the time being.

There’s a host of other tech giants aiming to deliver products as fast and cheap as possible. Among them include Amazon, which in December introduced a one-hour delivery service for its Prime members and expanded its same-day delivery service in seven cities last year. The Seattle online giant has also partnered with the taxi-hailing app Flywheel to test package delivery in some markets.

In addition, eBay operates eBay Now in four markets — though it has recently scaled back plans for the service — while Google and Walmart have tried something similar. Startups like Instacart, PostmatesWunWun, and Deliv also offer ways for customers to have items delivered within 24 hours.

However, one key difference to note is that Sidecar is initially offering something geared more toward businesses to help with back-end logistics, rather than a consumer-facing service.

Regardless, all these companies are trying to improve delivery of everything from people to meals to groceries. Scott Stanford, co-founder Sherpa Ventures, noted this trend back in July when we interviewed the venture capitalist about his investment in food delivery startup Munchery.

Amazon launched a same-day delivery service for household goods in December.
Amazon launched a same-day delivery service for household goods in December.

“Consumer expectation has changed as a result of greater connectivity,” Stanford said. “When you think about what the Internet did to media and changed consumer expectation and requirements, the same thing is happening to commerce.”

While Sidecar is far behind Uber and Lyft in terms of capital raised and total users, the company has been aggressive to push out innovative new services. For example, it rolled out a carpooling option called Shared Rides before Uber tested out UberPool and Lyft introduced Lyft Line. And now, it seems to be ahead of the game with its delivery service that combines people with products in the same vehicle.

“The innovation cycle in the ‘ridesharing’ market is breathtaking,” Fred Wilson, a Sidecar investor and co-founder of Union Square Ventures, noted in a blog post. “If you want to stay in the game you have to keep innovating and do that quickly. The result is new services, new markets, and new possibilities. And people plus packages is exactly that.”

This past August, we interviewed Paul and asked him about people who say the on-demand transportation space was a “zero-sum game.”

“That is a very narrow view of the world,” Paul said. “There will be lots of winners in this category.”

Sidecar operates in 10 U.S. markets and has raised $35 million to date.

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