Two Seattle companies made an appearance in Uber’s IPO prospectus that published Thursday as potential threats to its business.
The transportation giant revealed its financials and other details as the San Francisco-based company prepares to go public later this year.
While known for its ride-hailing app, Uber is also investing heavily in food delivery and trucking. The company listed Amazon as a competitor for meal delivery and Seattle startup Convoy as a competitor to its Uber Freight service.
Uber Eats generated $1.46 billion in revenue last year, up from $587 million in 2017, according to the IPO documents. Forbes called Uber Eats the company’s “secret gold mine.” Uber Eats launched just over three years ago and has 220,000 restaurants on the app in more than 500 cities globally.
Amazon, meanwhile, offers food delivery via Amazon Restaurants, which launched in 2015, and its Prime Now app. Uber also said Uber Eats competes with “restaurants, meal kit delivery services, grocery delivery services, and traditional grocers.” Amazon delivers meal kits and owns Whole Foods, which has expanded grocery delivery following the Amazon acquisition.
Other Uber Eats competitors, as noted in the filing, include GrubHub, DoorDash, Deliveroo, Swiggy, Postmates, Zomato, Delivery Hero, Just Eat, and Takeaway.com.
Uber launched its on-demand trucking marketplace, Uber Freight, in May 2017. Since then, it has contracted with more than 36,000 carriers and served more than 1,000 shippers, including corporations such as Anheuser-Busch InBev, Niagara, Land O’Lakes, and Colgate-Palmolive. Uber Freight reeled in more than $125 million in revenue for the quarter ending December 31, 2018. Last month it expanded to Europe.
Uber Freight competes directly with Seattle-based Convoy, which launched just three years ago and has already raised $265 million, including a giant $185 million round this past September led by Google’s VC arm that propelled the startup to unicorn status. Much like Uber Freight, Convoy also builds technology to facilitate transactions between trucking companies and shippers, providing an alternative to brokers who traditionally use phone and email.
In March 2017, Convoy said it had more than 400 customers, including 20 Fortune 500 companies, and 100,000 truckers on its platform (we’ve followed up for more recent metrics). The company’s investors include Jeff Bezos, Bill Gates, Expedia Chairman Barry Diller, Salesforce CEO Marc Benioff, Code.org founders Hadi and Ali Partovi, and former Starbucks president Howard Behar.
One interesting twist is that Uber CEO Dara Khosrowshahi was an early Convoy investor. Recode noted that Khosrowshahi may have had to divest his shares in Convoy after he left Expedia and became Uber’s CEO in 2017, given the competition with Uber Freight.
Uber co-founder and board member Garrett Camp also invested in Convoy and divested his shares in June 2017, reported Recode, which hinted that Convoy “could become an attractive acquisition target for Uber down the line” given Khosrowshahi’s involvement with Convoy and his history of acquiring companies while leading Expedia.
— dara khosrowshahi (@dkhos) October 28, 2015
We’ve reached out to Convoy about Khosrowshahi’s investment and will update this story when we hear back.
Other Uber Freight competitors include C.H. Robinson, Total Quality Logistics, XPO Logistics, Convoy, Echo Global Logistics, Coyote, Transfix, DHL, and NEXT Trucking. Here’s more from Uber’s IPO filing on Uber Freight:
According to the American Trucking Associations, businesses spent $700 billion on trucking in the United States in 2017, a total that we believe represents the SAM for our Uber Freight offering. Uber Freight currently addresses the brokerage portion of the United States market, which Armstrong & Associates estimates was $72 billion in 2017. We believe the business logistics market is moving towards an on-demand logistics model, as evidenced by the brokerage segment growing at a compound annual growth rate of over 11% from 1995 to 2017. We believe that we penetrated less than 0.1% of this $700 billion market given our $359 million of Uber Freight Gross Bookings for the year ended December 31, 2018.
Uber said it will continue to invest in and expand both Uber Eats and Uber Freight.