SPEAKER_01
Oh, wow. We got a dot coming. Wow, it's like a TARDIS. Yeah.
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Tony Hsu is the co-founder and CEO of on-demand delivery giant DoorDash. He's grown the business from a Stanford side project into America's dominant food delivery platform, and is now pushing into everything from grocery to retail to autonomous vehicles and financial products for gig workers. Great. Cheers. Cheers. Good to see you. Good to see you too, John. As I think back to that era where you guys got started, what year was DoorDash founded? 2013. Okay. Yeah. As I think back to 2013 and those early days, the iPhone and the apps that were made possible by the iPhone was the defining tech trend of the era.
SPEAKER_01
Uber and Lyft and ride sharing, Instacart, you guys, all of the magic wand apps that made your iPhone useful for bringing things to you and manipulating the wider world. And loads of people were going after food delivery and way more than are around now. As you look back on that journey from, again, it was really kicked off by the iPhone in my opinion, not that there wasn't food delivery before the iPhone, but that really massively increased the market size. As you think about from then to today, why did you guys win? Well, the short answer is we got more customers than other people. Sure. But let's say five ways here. Yeah.
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[SPEAKER_00] I think these are very tough things to study because many things are happening in the same moment. [SPEAKER_00] But I'll just talk about it from the perspective of things that I think we got right. [SPEAKER_00] When you think about something like restaurant delivery, you actually get judged on multiple dimensions as a service. [SPEAKER_00] We get judged on what restaurants we bring you, certainly whether it showed up on time and the quality and condition you expect.
SPEAKER_00
How much did it cost? If we screwed up, what did we do about it? It's not one thing that you have to be good at, actually. It's all of the above. Unfortunately or fortunately, this is literally the game that we're playing where customers are judging us in all of these dimensions. I think getting that right better than anyone else as measured by whether or not people are coming back to the app and using us, using us even when we had no money to market to them or discount offers to them, things like that, I think was the tell.
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[SPEAKER_01] Are you saying it was a very complex, multi-variant challenge, even from early on, and you guys just embraced that complexity and said, okay, this is going to be super complex to get right? [SPEAKER_01] Whereas maybe others took a bit more simplistic? [SPEAKER_01] I think if I were to become overly reductionist and purely looked at it— [SPEAKER_01] That's what I like to do. From the product perspective, yes. [SPEAKER_01] Because at the end of the day, any consumer product is judged very simply by its retention and its usage.
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[SPEAKER_00] That's how you know whether you have a differentiated product. [SPEAKER_00] I think it's very easy to have differences in opinion about whose app do you prefer or whether certain apps look similar or different.
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At the end of the day though, if our app is performing at a higher retention, much higher retention and frequency of use than others, that's how we know whether the things that we say actually are making a difference to customers.
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[SPEAKER_00] And so getting all of that right very, very early, and then building the systems to actually instrument that as well as to repeat that over and again, I think was very, very important in the development of the company.
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[SPEAKER_01] Do you think you guys were more focused on retention than others? I don't know if we were more focused. [SPEAKER_01] I mean, I could tell you though, one of the things that was happening, especially when you see a competitive fight, is you see everybody race towards it, right? Everybody is going to try to make offers to customers, try to give discounts, try to give coupons, free this, free that. One of the things that we had looking backwards is we actually did not have a large budget. In fact, between 2016, 17, and 18, we barely were able to raise a dollar relative to our peers.
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[SPEAKER_00] As a result of that, that made it a constraint.
SPEAKER_00
One of the constraints is, okay, you can grow, but you cannot spend in order to do it. So in order to do that, you effectively have to come up with ideas in the product to stand out and make a difference and have organic growth carry you. And then once we were able to demonstrate to ourselves first that we had a product with higher retention than other people and higher frequency, and then we were able to raise capital, then we actually made the decision to pedal to the metal and go and acquire customers because we had an unfair advantage. [SPEAKER_01] Were you more customer obsessed than others?
SPEAKER_00
I think it's very difficult to measure us against other people because I didn't really work at those companies. [SPEAKER_01] But again, I really just look at the early DoorDash crew and what were the things that we did that were very useful. We all did deliveries. We all did customer support. We all made menus.
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[SPEAKER_00] We all sold restaurants.
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We all customer serviced restaurants. We all worked inside restaurants. And I think at the end of the day, I think the term customer obsession can be fairly generic and vague and applied. And it really just goes to show, what actions actually demonstrate that. For us, some of the ones that came to mind and frankly, the story that actually inspired the value in the first place was when our backs were against the wall, and we had less than two weeks of cash runway. And we had a terrible night where every single order was late. This was a Stanford football game in 2013, and I had trouble raising the seed round. We made the decision to refund everyone.
SPEAKER_00
That cost us over 40% of the bank account. So when you have two weeks of runway, 40% of the bank account. [SPEAKER_01] You issued a refund that was 40% of your funds were running? Yeah, maybe a little over that. [SPEAKER_01] And we baked everyone cookies and delivered them at 5 a.m. before everybody woke up. Look, this was maybe 100-ish customers or something like this. But I think it demonstrates that this was a real value. And that's actually my test really, which is, what are the actions that are naturally occurring?
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[SPEAKER_00] What are the behaviors that are actually occurring inside of an organization?
SPEAKER_00
And then how do you actually articulate it? Versus the inverse, which is you start with maybe some articulation and maybe some of the times it matches and other times it doesn't. And so I've always believed that these cultural norms or behaviors are really 80% of what you've done.
SPEAKER_00
Look, this was maybe 100-ish customers or something like this. But I think it demonstrates that this was a real value. And that's actually my test really, which is what are the actions that are naturally occurring? What are the behaviors that are actually occurring inside of an organization? And then how do you actually articulate it? Versus the inverse, which is you start with maybe some articulation and maybe some of the times it matches and other times it doesn't. And so I've always believed that these cultural norms or behaviors are really 80% of what you've done. And I think that's the best way to actually find what they are for your company. And we're the only platform today to take care of Dashers when there are these increasing gas prices and making sure that we have their back and that we're actually trying to help them save $1.40 to $1.90 per gallon for Dashers. Or in COVID, we were the only company to cut commissions by 50% when we were not yet profitable as a company. That was an expense over $100 million. We then on top of that, spent millions of dollars buying national TV campaigns to tell people to order, whether it's on us or our competitors. Because restaurants have on average 17 days of cash on hand. So you need to order. This is do or die for them. And so I can give you many of those examples where I think at the end of the day, whether the actions first speak and then you can articulate where the actual words and norms and cultural behaviors that the company is trying to speak. So I think that's ultimately how I think about customer obsession. And if I try to draw what these values are, it seems to be a very clear-eyed focus on the best product experience and taking care of Dashers.
SPEAKER_00
[SPEAKER_01] I didn't realize you guys had a time when you had only two weeks of cash in the bank account.
SPEAKER_00
[SPEAKER_01] We had several moments where we ran out of money. John, so we had that moment, obviously, in the fall of 2013. We had three very difficult years, 2016, 17, and 18, where we had two rounds of financing that were incredibly difficult for us, the Series C and Series D. And COVID was interesting because COVID started actually, again, I think it's easy to forget these things because humans adjust very quickly. COVID, the first week, actually, the business tanked 80%. It tanked massively because everything was shut down. And then the next week, everything, all of the dining rooms were closed, but the kitchens were open. And so we see this massive doubling of the business in a week. So it was there are a lot of these moments as an entrepreneur where you have very, very low lows. The highs don't feel as high as maybe they get, but that's what you get.
SPEAKER_00
Yeah. [SPEAKER_01] As I think about the funding rounds, you mentioned being hard. One of the investors I know who has consistently had the most steadfast belief about DoorDash is Michael Abramson, who was at Sequoia back in the day. Why was he so convicted? What was it? I think you're going to have to have him on the show.
SPEAKER_00
Okay, yeah, we will. That'd be good. To ask him. But I think Michael always had a fairly simplistic view of the company, where if three things worked, the business kind of works. It's actually reminded, when I met Michael, it actually reminded me a lot of our journey in Y Combinator. Because I think in Y Combinator, we were just happy to be there. But a lot of people were really racing towards Demo Day, where the objective function was to raise as much money at the highest possible valuation. For us, actually, the objective function was answering three questions. It was, would consumers pay for this product, pay a premium for delivery? Would merchants actually work with us and pay us commission? And would Dashers partner with us for a wage that we could afford? And I think Michael had a very similar set of very simple questions about the company. And I think so long as those dimensions looked right to him, he kept on investing. And then he said, you have to do the math and work out that the economics of this business do work. And they do. Therefore, a more compelling product experience will win.
SPEAKER_00
[SPEAKER_01] Yeah, that he believed that if the unit economics were there, that we could secure enough Dashers. And I think his third comment was really that we can continue executing into the market opportunity, that things will work out. Yes. [SPEAKER_01] He turned out to be right. Yeah, yeah.
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[SPEAKER_01] Thinking more about this ecosystem, food delivery is very popular in the United States. It is even more popular in China. I feel like the experience of just being in a major Chinese city is one of seeing food delivery. You go to a restaurant and there's mopeds everywhere. You're on the roads and there's flocks of mopeds everywhere delivering food. The apartment buildings and the office buildings have dedicated zones to streamline it. Yes, yes. [SPEAKER_01] Why is food delivery so much bigger in China than it is in the US?
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Yeah, there are a few things. This is one where I'm always on the one hand so impressed by how far ahead sometimes behavior is in markets like China. And then on the other hand, I have to remind myself that there are differences and why you can't just clone these markets. Well, one of the first big differences is the eating out culture in China is very high and very affordable. Eating out in China is about as affordable as cooking at home. And as a result, nobody cooks. [SPEAKER_01] And as a result, nobody cooks.
SPEAKER_00
[SPEAKER_01] Exactly. And there are a lot of reasons for this. But we can go deep on retail history and grocery history in China. But that's a huge phenomenon. I think second, because of labor market dynamics in both the availability as well as the cost of labor in the Chinese market, that's allowed a lot of these businesses to make this activity almost as affordable as if you were to pick up the orders yourself. I think third is that especially it's not every city in China, but more and more, the Chinese, it started really with the eastern seaboard cities where the density just allowed a very easy delivery kind of setup almost like every city was like New York City. I think in America, we think New York City is very special.
SPEAKER_01
[SPEAKER_00] But that's a huge phenomenon. [SPEAKER_00] I think second, because of labor market dynamics in both the availability as well as the cost of labor in the Chinese market, that's allowed a lot of these businesses to make this activity almost as affordable as if you were to pick up the orders yourself.
SPEAKER_00
I think third is that especially it's not every city in China, but more and more, the Chinese, it started really with the eastern seaboard cities where the density just allowed a very easy delivery setup almost like every city was like New York City. I think in America, we think New York City is very special. It has millions of people. There's more megacities in China. And the population density is even perhaps higher than that of Manhattan. And that's morphed to the western cities, too. It's not just the eastern seaboard cities.
SPEAKER_00
If you study this over a time series, whether it's the 80s to the 90s and certainly to today, because of how fast China is able to manufacture things, city plan things, deploy things, literally they can build a train station an entire day because they can do things like this, the market potential has really expanded even as people move now from eastern seaboard cities to other cities. So you're saying a big part of it is lower labor costs mean food delivery is quite inexpensive. Does that affect the cost of the food? I would start with that: the cost of the food is a lot lower. So you have lower labor costs, and you also have mass availability of labor. Yes.
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And then you also have a rising income because of how fast cities are getting developed. [SPEAKER_01] It used to be that most of the income for consumer discretionary spend, if you studied as a percent of China's GDP, was along the eastern seaboard. I would say take circa the early 2000s, even up to the 2010s. But if you've looked over the last 15, 20 years, that has now become a lot more uniformly distributed, like the US, actually. The entire country is coming richer, like the US, whereas this is not true in other parts of the world.
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[SPEAKER_00] Well, where I was going with this is, does that then predict the behavior of other markets where there's also a lot of food delivery in other markets where food is cheap and labor is cheap? And whether or not there are a lot of restaurants and people who can afford delivery, sure. But also the production of food. [SPEAKER_00] Yes, yes. Right? [SPEAKER_00] I think one of the things that I've always thought about is restaurants have two very special properties about them. And I do think that more and more they are almost going towards the ends of these two spectrums. Same thing with retail.
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[SPEAKER_00] We can talk about that too. But restaurants on one hand are centers of hospitality. And it's incredible, the level of attention to service they have. And I think that will never get replaced by AI, that human to human connection.
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On the other hand, where technology and autonomous technology can make a difference is restaurants are almost like manufacturing production sites. Yes. There are third space and a factory. Yes, yes. All in one. And it's no different in retail. You have showrooms and warehouses, right? Yes. So in the case of, back to your point around China, China has a lot of restaurants, over 7 million restaurants. Yeah. Versus what we have here in the US at about a million restaurants in comparison, for example.
SPEAKER_00
And in China, you also have a very deeply capitalistic society in the sense that wherever there is opportunity, you're going to see lots of people go and fill that. It doesn't have to be a restaurant. It could be a kitchen. It could be coming up with different merchandising. And if you're a restaurant, you can sell not just food, you can sell T-shirts and you can sell hats and you can sell cookbooks. And I think there's a lot of that commercialism also in that industry in a way that is much more advanced than other countries. Yeah.
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Restaurants are very hard businesses and they're one of the most common businesses that people start. And yet they're incredibly sophisticated, even at a small scale. Yes. And they are also incredibly sought after. In fact, if you looked at the census data in America now, and this is also true in China, but if you looked in America in the last 60 years, I think there's only a couple of years where the number of restaurants in the current year didn't exceed that in the previous year.
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[SPEAKER_00] And even though they are such difficult businesses because of our love for food, for socializing, being with each other and what a meal represents and how it can connect different people, it continues to grow. In fact, it's the number one type of establishment that malls and shopping centers want the most of. Talk to me about the trends in the restaurant industries these days. If I think about what people talk about, there's dark kitchens.
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So that was a few years ago, people were talking about dark kitchens. There's the fact that high-end restaurants can't make any money these days because no one drinks. There's the emergence of new fast casual trends, but also some criticism of slop bowls and everything. But that's just what people are talking about. You're in it. So tell me what's actually going on in the restaurant industry.
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[SPEAKER_01] One of the most difficult things is how do you actually staff your restaurant? This is the number one challenge. This has always been the number one challenge. And there's no easy way around this. And because the cost of labor only goes in one direction, only goes up, restaurants are increasingly making this choice of on the continuum of service to manufacturing, where do I want to sit on that spectrum? I think that is one very big trend that more and more restaurants feel they have to go towards the ends of the spectrum. Whereas before... You have a local restaurant where people are sitting and eating their dinner and also fulfilling a few takeout orders.
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Yes, yes. And you're saying that's becoming less common.
SPEAKER_01
[SPEAKER_00] Yes, because there's a lot more pressure to make sure that everyone deservedly gets paid what is required to work there, especially inside some of these city centers. So I think that's a perennial trend. I think that is one very big trend that more and more restaurants feel like they have to go towards the ends of the spectrum. Whereas before... [SPEAKER_00] You have a local restaurant, thus people are sitting and eating their dinner and also is fulfilling a few takeout orders. [SPEAKER_00] Yes, yes. [SPEAKER_00] And you're saying that's becoming less common.
SPEAKER_01
[SPEAKER_00] Yes, because there's a lot more pressure in order to make sure that everyone deservedly gets paid what is required to actually work there, especially inside some of these city centers. [SPEAKER_00] So I think that's a perennial trend.
SPEAKER_00
I think a second perennial trend, and this is why I think people love restaurants, is there's... The innovation in restaurants is a little bit different than the innovation in software, where innovation restaurants just like different types of cuisines and food. And so you're always going to see the next type of restaurant. And I think this is best shown in what I was saying earlier around the number of restaurants. [SPEAKER_01] The number of restaurants always grows. That's a perennial trend. That's something that is not changing, even though the types of maybe food is changing or what's hot, what's not, that's changing.
SPEAKER_00
What's not changing is the consumer's appetite for actually these restaurants. I would say number three is restaurants are thinking about increasingly how to scale, and this takes on different forms. So in the case of some of these large brands, the big QSRs that you've heard of, which represents almost 50 cents on the dollar of restaurant spend in a place like the US. They're thinking about how do I take my economies of scale and just keep going, right? Because I have that as a big advantage. But you also see smaller restaurants who are trying to figure out how do I open up location number two. And it's really difficult.
SPEAKER_00
It's actually really, really difficult in a lot of cities, even for the most popular restaurants, the hottest chefs in town, who you'd be shocked at how hard it is for them to raise the capital for location number two, or even get the permits to start construction on location number two. And so I think these are another perennial trend that you see happening in the restaurant ecosystem. So those are the ones that I think a lot about, which are, what are the things that are not changing, that are incredibly difficult, that if you can solve these big rocks, you can unlock even more value.
SPEAKER_00
Now, I presented a lot of obstacles, but if you actually look at the totality of the data, you would see that the amount spent on restaurants for eating out has increased over the last 75 years, every single year. It used to be that in the 1950s, when the government was measuring this, we would spend in this country in America, maybe 75 to 80 cents on the dollar on groceries versus restaurants. In present day, those numbers are almost reversed where it's almost 60 cents on the dollar on takeout and 40 cents on grocery. And that number has only gone in these proportions or this direction.
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So even though it is so difficult to make it as a single restaurateur, especially when I think about the days of washing dishes in my mom's restaurant, the totality of the industry continues to remain very strong and they're moving in one direction.
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[SPEAKER_00] When you talk about permits, famously, a lot of cities do a bad job of making it hard to open a restaurant. [SPEAKER_00] San Francisco people have a lot of complaints.
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And one of the innovations that you see these days in restaurant culture is the food truck gardens and food truck collections. And I always find those bittersweet where often you have really cool new concepts and stuff, but we have societally lost the ability to allow people to open restaurants and therefore we're reduced to a collection of food trucks in a parking lot somewhere. Are permits getting better or worse? I think in general, similar to building things, they've gotten largely worse on average, right? [SPEAKER_01] That doesn't mean there aren't cities who are green lighting and making it a lot easier.
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[SPEAKER_01] In fact, if you look at some of the fastest growing cities in the country, they tend to also be the fastest growing cities for restaurants. [SPEAKER_01] Not a shock, right? It's probably not San Francisco. [SPEAKER_01] So are places like Phoenix and Austin and these places doing a good job of permits? [SPEAKER_01] Yeah, if you look at places in Arizona, the Tri-City area, Phoenix being one of them, Scottsdale and the Tempe area there.
SPEAKER_01
You look at the Tri-City area in Texas, near Austin, or you look at what's happening in Dallas and the Dallas Plano area.
SPEAKER_00
There's these pockets in the country. In fact, if you look at the country, a lot of this growth is happening in the south of the country. And that's been true for a couple of decades now. And they tend to be correlated, meaning if it's easy for me to build apartment units and to build construction in general, it tends to be a bit easier to also get the licenses to open up a restaurant. That's good. There's some bright spots amidst a nationwide, maybe negative trend when it comes to permitting. Yeah, look, I think when you're in any business, certainly the restaurant industry or even our line of work, you have to be an optimist.
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[SPEAKER_01] You have to see the silver lining on the way out of how to get there. [SPEAKER_01] But it's a slog. And I do think that one of the responsibilities we now have as a company, as we're a little bit bigger now, is to help on behalf, particularly of these small businesses, to represent them almost as a class. Yes. And actually, try to even the playing field a bit and make it easier to actually be a small business. What do you argue for on behalf of small businesses? Like when you talk to someone in Washington, what are you saying? Well, one of the first ones is actually making it easier to open location number two. So permitting reform.
SPEAKER_00
Yeah. Permitting reform is one of those things that we certainly stand for. Making sure that labor laws are changed or when they are changed, that they take into account the restaurants. [SPEAKER_01] We're talking about one of the largest sectors of job creation here that is always growing, by the way, every single year, which is a rarity. [SPEAKER_01] Yeah. But the tourism in every economy, to take into account what the restaurateurs have to say, those are some of the big topics. Again, I look at the things that aren't changing in terms of the difficult challenges of being a restaurateur and we try to fight on their behalf.
SPEAKER_00
Where has technology meaningfully changed how restaurants work? Like a very visible example to people might be in fast casual restaurants. They have managed to change the labor equation, it seems. You might know the actual number because it's self-serve ordering and pick up at the counter and stuff like that. [SPEAKER_01] Yeah. But the tourism in every economy, to take into account, what the restaurateurs have to say, those are some of the big topics. Again, I look at the things that aren't changing in terms of the difficult challenges of being a restaurateur and we try to fight on their behalf.
SPEAKER_00
Where has technology meaningfully changed how restaurants work? A very visible example to people might be in fast casual restaurants. They have managed to change the labor equation, it seems. You might know the actual number because it's self-serve ordering and pick up at the counter and stuff like that. That's much more common than it was. And so you need fewer people for the same volume of orders or you can run much more scale with the same number of people. I'm guessing there's supply chain stuff, but it's less visible to us as people who visit restaurants, but you'd know.
SPEAKER_00
But just as you think about where tech has made the biggest impact versus 10 or 20 years ago with restaurants, what would be your top three list? Well, one of the first things that comes to mind is actually something like delivery. Sure. Right. When you look at the economics for a restaurant, right? Rough math, for every dollar of food that if you and I bought inside of a restaurant, from the cost structure, you're gonna have 30% of that in the food and the packaging.
SPEAKER_00
You're gonna have 30% of it in the rent. You're gonna have 30% of it in the labor, something like that. Rough math. And on that dollar, a restaurant can net 10 cents. On a takeaway order, you're still paying for the food and the packaging, but you're largely speaking, using the same labor and you're paying the same rent.
SPEAKER_01
[SPEAKER_00] And there are some exceptions where some restaurants have become delivery only and things like that. [SPEAKER_00] But by and large, on average, you're gonna make three to five times the margin, the incremental margin. I think number two, I think restaurants recognize that they need to build relationships with customers that are not just over the telephone or over in person visits where they're relying on their memories. [SPEAKER_00] And so I think that area is still, I would say, somewhat incomplete, where there are products where you can manage your social media pages and maybe have a database of relationships that you recall.
SPEAKER_00
The challenge, however, is you don't get to see everything. You don't get to see all the full visibility of your online orders, your in-store orders. Another challenge is your staff turns over. You know, the average staff may turn over every other day. Not every other week, every other day. And so I do think that there's still a long road ahead there in both making that product a lot more robust for restaurateurs to be able to have those relationships. Because back to one of the things we talked about in this conversation about the importance of retention in a consumer business is so important for a restaurant to build the concept of a regular. [SPEAKER_01] Yes.
SPEAKER_01
Which is a retained customer, right? You and I, I know we travel a lot for work. And so we wouldn't always be great customers for a restaurant. What's more important actually is if they knew that there was a regular that is actually coming, that may should be prioritized. And so those are the things that I think hopefully DoorDash can help and actually solve. Don't most restaurants do a bad job of recognizing regulars where you think about the airlines as an industry. Yeah. They've made it where it's highly irrational as a frequent traveler to travel not your preferred airline. They've really created a lot of lock in there.
SPEAKER_01
Whereas as I think about restaurants, there is the super mass market punch cards, you know, 10th coffee free stuff. And then there is the really old school restaurant where the owner might greet you and might comp your dessert or something.
SPEAKER_00
[SPEAKER_01] But it's very sporadic and very dependent on the owner being there. Because as you say, when the new waiter or waitress is there, they don't know you. But there's nothing in between systematic and it feels like some kind of way of rewarding regulars is missing. Yeah. Well, it's a hard problem. Let me ask you, what is your favorite food to eat? Depends. But at the weekend we went and we got good Taiwanese food. Okay. All right. But how often do you eat that? Once a month, once every two months. Once a month, once every two months. That's the challenge, right? Even your favorite food is probably not something you're going to do every single day.
SPEAKER_00
When you're talking about an activity like eating, which is 20 to 25 times a week. It's not coffee.
SPEAKER_01
[SPEAKER_00] It's not coffee. It's even different from travel where the product may be the same every single time.
SPEAKER_00
I think it is tough to create what you're describing, which is this program in which you'll be known as a regular. But that I think is the opportunity that at least we're thinking about at DoorDash. Because if you think about it, our product with now over 100 million plus annual customers, tens of millions of monthly customers, they shop at various frequencies. And they're building relationships with all of these businesses, sometimes many times a day, sometimes once every other month, sometimes once a year. And I think because there's 20 to 25 moments per week, I think that there is an opportunity in which we can create that.
SPEAKER_00
And now we recently acquired last year a company called Seven Rooms that manages a lot of the in-store bookings of restaurants, particularly higher end restaurants. If we can democratize that and give that to everybody, and then also layer on the DoorDash dataset and actually tell you that John is a regular and he tends to like the following things and here's other things that he tends to do. Perhaps we can crack open that question. So you want to help restaurants take care of regulars? Yeah, because that is how you build a great consumer business. Yes. Right? You need the retention. That is true for every restaurant, every consumer business. Hmm. That's interesting.
SPEAKER_00
A core challenge for marketplaces like DoorDash is streamlining courier operations, like letting their network of couriers and shoppers make specific purchases for customers. Think about it. You can't use a traditional corporate card here. You don't have the right permissions. You don't actually get to interface programmatically with the card in real time. So Stripe issuing is our answer to this problem. With Stripe issuing, you can use Stripe to create virtual or physical credit cards. They can be single use, single vendor, programmatically controlled, whatever your use case needs.
SPEAKER_00
People are even these days giving their robot a credit card so it can spend money on the internet. So if you need to create credit cards to manage spending in the real world, see what you can build with Stripe issuing. [SPEAKER_01] We were talking a lot about ghost kitchens, I don't know, five or seven years ago. You don't really hear about them that much. How big have ghost kitchens become? [SPEAKER_01] They're relatively small. [SPEAKER_01] Yeah. So Stripe issuing is our answer to this problem. With Stripe issuing, you can use Stripe to create virtual or physical credit cards.
SPEAKER_00
They can be single use, single vendor, programmatically controlled, whatever your use case needs. People are even these days giving their open claw a credit card so it can spend money on the internet. So if you need to create credit cards to manage spending in the real world, see what you can build with Stripe issuing.
SPEAKER_01
We were talking a lot about ghost kitchens, I don't know, five or seven years ago. You don't really hear about them that much. How big have ghost kitchens become? They're relatively small. Yeah. People thought the model was going to take over, right? Yeah. Look, the model sounds really reasonable and I think logical on face value where if you can on that spectrum of restaurants where you have high end service on one end and hospitality only to perhaps delivery only or more of a manufacturing concept on the other end.
SPEAKER_01
And it seems reasonable that you can actually just borrow a small square footage of space, not incur a lot of not just the fixed costs, but also the labor costs of actually running your restaurant in quotes and then selling through a delivery platform or acquiring your own customers or doing something like both.
SPEAKER_00
[SPEAKER_01] It just turns out it's extraordinarily difficult, however, unless you're a large brand or you know a house of brands, someone like DoorDash to be able to attract enough customers to make that math work. [SPEAKER_01] So, is another way of putting it that it's hard for a ghost kitchen to be as efficient as a restaurant that is also churning out orders across both in restaurant and delivery? [SPEAKER_01] Like it's just hard for them to compete on the economics? Yeah, it's slightly different.
SPEAKER_01
[SPEAKER_00] So perhaps we can look at two types of examples. [SPEAKER_00] So you can have one type of example, which is perhaps my mom's Chinese restaurant, you know, it's an SMB where the name value outside of perhaps it's literally its locale isn't that well known.
SPEAKER_00
[SPEAKER_01] It's very difficult for that restaurant to acquire enough customers to make that math work because they still have to remember, I mentioned that staffing was the number one challenge that restaurants face. [SPEAKER_01] They still have to staff these kitchens. That's one of the challenges. Now you go all the way to the other side. So pretend you are a large QSR with a big brand presence.
SPEAKER_01
[SPEAKER_00] You certainly can attract lots of customers, but you're going to have to think for yourself, well, is my, what's my opportunity cost? [SPEAKER_00] My opportunity cost might be to open up another restaurant.
SPEAKER_00
Why not do that and take my economies of scale and actually apply it to more orders in store orders, as well as to go orders? Because I can do that with a restaurant, hard to do that with a delivery only kitchen. And so I think because of that, it's a tricky model to scale to every type of restaurant brand. Yeah. I think people maybe thought this big chains were going to do it more where you're right, the billboard effect for an actual retail presence is hard to compete with for you get this very cheap customer acquisition from the fact that people know your name from the high street or maybe have been to you.
SPEAKER_00
And as a ghost kitchen, you need to make up for that awareness gap. But if you're Chipotle, maybe people thought the orders get fulfilled out of a dedicated Chipotle central factory, and then the retail space are separate. But also that hasn't really happened that much. That happens occasionally, right? And it's because I think these are not decisions where we're accounting for all of the variables. You know, one variable we're not accounting for is, well, what else could I do with the space?
SPEAKER_00
You have to remember for businesses like Chipotle, who tend to identify real estate in fairly expensive areas, there's high opportunity costs of what you do with that space. Yes, you're right. One choice is to turn it into a kitchen or a delivery only kitchen. And sometimes that happens. But there's also a massive opportunity to recoup the expense. And if you start introducing, for example, franchises for Chipotle is not really franchised. But if you look at other types of brands where it is franchised, I think that the economics become even trickier. Hmm. So the next best use kind of math. Which restaurants have actually invented something that's hard to copy?
SPEAKER_00
Well, I actually think any restaurant that's been around for, let's say, two plus decades probably has very interesting IP. And obviously, some of this information is not public. So but you can imagine when you go into a McDonald's around the world, that French fry, perhaps they don't sell the same exact items in every single store in every country, every city.
SPEAKER_01
[SPEAKER_00] But the French fry almost always tastes the same. That is an extraordinarily difficult feat to accomplish. [SPEAKER_00] There's a lot that goes behind the scenes, just like there's a lot that goes behind the scenes at DoorDash in terms of getting you one order on time to make that sentence true. [SPEAKER_00] Mm hmm. And the same can be said about a lot of other businesses that have been around for very long periods of time. [SPEAKER_00] That's on the big brand, QSR side where a lot of the innovation, if you will, is in the process innovation. And then also, how do you run large groups of people and have very high and consistent standards of service?
SPEAKER_01
That's extremely difficult, extremely difficult. And that's the IP, I would argue, for a lot of these large brands. Now, on the other side, there are small restaurants, some of whom have been around for almost a century, actually. There aren't that many of them. But when you look at what makes them special, it tends to be the same things that actually make startups special. It tends to be a small group of people that really believe in a certain idea, some commitment towards some standard of excellence.
SPEAKER_00
[SPEAKER_01] It could be excellent towards the food, the service or takeout. There are some takeout only businesses that have been around for many decades. [SPEAKER_01] And as a result, they have high retention, high usage, and they're very efficient. [SPEAKER_01] Can you speak about any specific examples of just the impressive IP that these chains have conducted over the years? [SPEAKER_01] Like it could be the McDonald's French fry, how they actually make it taste consistent. I don't know the answer to that or any other of your favorite restaurants.
SPEAKER_00
[SPEAKER_01] Yeah, well, one of the things that I'll never forget was I went through a hospitality training at Chick-fil-A in, I want to say it was 2017, maybe it was 2018. [SPEAKER_01] And I don't remember everything on the checklist, but one of them that stands out is that the floors must be so clean that babies would lick them or could lick them. [SPEAKER_01] And... [SPEAKER_01] The babies will lick them regardless of how clean they are. [SPEAKER_01] Is Chick-fil-A still the highest grossing fast casual restaurant per square foot? [SPEAKER_01] I don't know actually, but it's definitely up there. [SPEAKER_01] People talk about it.
SPEAKER_00
[SPEAKER_01] Yeah, but it's definitely up there. Why is it so successful? Well, it actually goes back to I think the standard ingredients of a great consumer business. It has a highly retentive following, which it spends very little money acquiring. [SPEAKER_01] And the babies will lick them regardless of how clean they are. [SPEAKER_01] Is Chick-fil-A still the highest grossing fast casual restaurant per square foot? [SPEAKER_01] I don't know actually, but it's definitely up there. [SPEAKER_01] People talk about it. [SPEAKER_01] Yeah, but it's definitely up there. Why is it so successful?
SPEAKER_00
Well, it actually goes back to I think the standard ingredients of a great consumer business. It has a highly retentative following, which it spends very little money acquiring. [SPEAKER_01] And they come back often. And they're extremely efficient with all of the scale economies behind the scenes around equipment, which is quite custom to that company, to the service training, to how they treat their staff.
SPEAKER_00
One of the most impressive facts about that business is that many people that I met with have spent over two, three decades of their careers at Chick-fil-A. And I think we find that to be a novelty actually here in Silicon Valley or in technology and in the restaurant industry. In the restaurant industry, where we described all of the churn and the difficulty of staffing, Chick-fil-A has extremely high retention of staff. And it has so many repeatable stories of where it gives somebody who comes from not a lot of means, frankly, to become the general manager of one of these stores and earns a really healthy living, pays their entire family through college and beyond.
SPEAKER_00
[SPEAKER_01] And I think in many ways a lot of these restaurant stories, Chick-fil-A being one of them, have a lot of the essence still of the American dream. We're talking a lot about QSR chains here. And people often like to ask the question of why is there not a Chipotle of my preferred cuisine, where it's slightly elevated versus regular fast food, very good, consistent quality, good execution. There is no chain that serves you really good Neapolitan pink crust pizza in whatever city you're in or Indian food, or pick your favorite cuisine. Why don't we have more chains delivering just a really good standard version of the cuisine?
SPEAKER_00
Have you ever cooked for a large group of people? Or do you cook often? [SPEAKER_01] Yeah, we cook, but not for huge groups. And one of the things I found is that as the number of people you have to cook for grows, the difficulty to keep the standard of service, whether it's the taste, the temperature, the speed in which you receive the food goes up exponentially. And that is what's so hard about exactly what you just said around keeping that quality control really high. It's maybe easy to build the Chipotle for one type of cuisine for one restaurant. And that's just on the skill perspective. Although I do have some ideas on how perhaps you can do that.
SPEAKER_00
But the second reason also is think about who you're competing against, right? So you have to now, okay, let's say that you want to make a Neapolitan pizza, or any kind of pizza. Okay, great. I can't wait to taste it. I can't wait to taste it, John. Okay, well, did you know that there are over a thousand different pizza choices in the Bay Area on DoorDash? Just on DoorDash, right? And we don't have all of the restaurants.
SPEAKER_01
And that is just one of the many things that you're going to have to do to be able to create this concept and actually scale it. [SPEAKER_00] It's not the same. And then don't forget all the other challenges we talked about. The staffing. [SPEAKER_00] The permitting. But what determines whether chains succeed versus whether they don't? Because there's a lot of pizza restaurants in the Bay Area. But at the same time, there's a lot of Mexican restaurants in LA that are really good. And yet Chipotle still has plenty of locations there.
SPEAKER_01
[SPEAKER_00] And so it doesn't just seem to be, do there exist local options? Sometimes a chain can break through. And I also don't think it's a skill issue because it's very processizable to make a good Neapolitan pizza. It's about the ingredients and the temperature and humidity control in the proofing of the dough. And then cooking it at very high temperature. But it's not rocket science. You could make a process around this. [SPEAKER_00] But I think the fact that there only exists so many of these QS accountable numbers of these brands who have actually scaled to the size that we're talking about where they're ubiquitous, I think that should be some evidence.
SPEAKER_01
It's harder than you think. It's a lot harder than you think. And because of what I just said, there's a lot of process skills that you have to be extraordinarily good at. [SPEAKER_00] In fact, I remember we partnered with one brand where we launched this brand to great fanfare. And sold a lot of burgers actually on a weekend testing this idea. Can you make a healthy tasting burger if you put a brand name around it? The answer is yes. And the answer is really hard to retain any of those customers.
SPEAKER_01
Because it's too healthy? [SPEAKER_00] No, because half of the reviews said your burgers were great. And the other half said that they were inconsistent in quality. And it's because it's extremely difficult that exponential challenge as you try to grow scale and keep up the quality is very, very, very difficult.
SPEAKER_00
[SPEAKER_01] I mean, you have to get right the service. You have to get right the production. You have to get right the pricing, the packaging. There's lots of things you have to get right. So do you think reliability is the thing that people underestimate about the restaurant industry? Yes. Or about a service like DoorDash. I think when you have high volumes of activity, I think keeping the reliability as reliable as the electricity we have or the water inside of our buildings, that is extraordinarily difficult.
SPEAKER_01
[SPEAKER_00] When we talk about the future of delivery and how you see it playing out in 10 years' time, there's a few different modalities being discussed. There's drone delivery. There is sidewalk robot delivery. And you guys have DOT. I'd love to talk about DOT. I don't know how much you're doing in drones. Maybe you can talk about that too. Maybe there's autonomous vehicles like autonomous cars. People don't talk about that that much. But maybe in the suburbs, it would work.
SPEAKER_00
That's what we have at the moment. When we talk about the future of delivery and how you see it playing out in 10 years' time, there's a few different modalities being discussed. There's drone delivery. There is sidewalk robot delivery. And you guys have DOT. [SPEAKER_01] I'd love to talk about DOT. [SPEAKER_01] I don't know how much you're doing in drones. [SPEAKER_01] Maybe you can talk about that too. [SPEAKER_01] Maybe there's autonomous vehicles like autonomous cars. People don't talk about that that much. But maybe in the suburbs, it would work. [SPEAKER_01] That's what we have at the moment. Just what's the mix in 10 years' time? Yeah.
SPEAKER_00
Well, I think even before we go there, I think the first question might be what might be delivered? Because I think that's actually still not that well understood. So today, yes, DoorDash is probably most known for food, and now increasingly groceries and household items. But that is a fraction of the tens of millions of items inside every single city. One of the biggest things that we're going to have to do before we can just fulfill the items, which is what we'll get to, is where are the items? And what are the items? There's tens of millions of items literally inside these cities, whether it's in the US or different countries within Europe, other parts of the world.
SPEAKER_00
They're not catalogued. There's no structured data that you can scrape in order to figure that out. And I think that's going to be a long journey. Sometimes the inventory is not even close enough. And so you may have to house the inventory so that you can actually bring those goods and even have the right. A lot of what I believe makes for great logistics is you need a great setup.
SPEAKER_01
[SPEAKER_00] Because if you're always trying to figure it out on the fly and you're pulling some magic trick out of thin air and you have to be the hero, that is not a system. [SPEAKER_00] That is an exception. [SPEAKER_00] And I think great logistics or great reliability, they require building systems. [SPEAKER_00] And so, okay, you have the catalog, you got maybe the inventory close enough to where people live. [SPEAKER_00] Now we can talk about the fulfillment, right? [SPEAKER_00] But the entirety of that is what you have to build before we can get into the great technologies and the A-Bs. [SPEAKER_00] And you know what it is that you're delivering.
SPEAKER_01
[SPEAKER_00] Yeah, because if you don't know where to get the items or if you can't get the right item, what difference does it make if you have the right vehicle? [SPEAKER_00] And you're talking about the fact that you don't actually know what's on a supermarket's shelves where the fact that you have to actually be able to predict when the restaurant will have the stuff ready, all that kind of knowing what is ready to be delivered. Yeah, or I mean, take when the cheeky pint becomes an established bar and maybe DoorDash can deliver from one day. What's inside the cheeky pint? Yeah, yeah. You know, what's on the actual menu? What's off menu? And actually you can order.
SPEAKER_01
I mean, these are complicated issues before we even get to the fulfillment of the actual items. And so, okay, then you can get to fulfillment, right? And I think that's one where we're still exploring.
SPEAKER_00
[SPEAKER_01] And to me, the most important question we always ask on any, frankly, technology, but certainly a technology like this where there's long cycles of development is what problem does it actually solve? [SPEAKER_01] Yeah. [SPEAKER_01] Obviously, in the case of drones, you mentioned it, it can cover a lot of ground very quickly. So longer distance orders, that seems to be a great job for it to solve.
SPEAKER_01
[SPEAKER_00] In a busy high rise area where you got short dense orders was just the majority of these orders, maybe not the best solution for such product, right? [SPEAKER_00] And this is actually what led us to the creation of DOT, which was when we started the autonomy project in 2018, 2019, we actually did not set out thinking that we needed to build anything, that we would surely there would be someone.
SPEAKER_00
Yeah, yeah. We'll just pick the best one and I'm sure we can buy some tech off the shelf. Yes, we were out there raising our hand, asking for a partner to the dance, so to speak, and someone who could specialize in that and we could specialize in the operations and things like this. And it turned out that, well, no one was that interested. A lot of people were interested in building robotaxis, a lot of it, and obviously we've seen that come to fruition.
SPEAKER_01
[SPEAKER_00] A lot of people did build, to your point, sidewalk robots, but we found those to be too slow.
SPEAKER_00
So back to what problems are you solving? Because you've got to remember, back to opportunity costs, humans are very good at delivery, actually, it turns out. We're also very good at driving, too. Yeah, yeah, yeah. And so the bar is actually a fairly high bar. It's not as simple as just saying, oh, we can make the technology, let it rip. And so then we said, well, okay, well, it has to be fast enough. It probably doesn't need to be the size of a car because cars aren't very good at parking inside these busy locations where a lot of these restaurants are.
SPEAKER_01
[SPEAKER_00] And so we had to think about all these things. [SPEAKER_00] We had to think about how to load the vehicle. We had to think about unloading the vehicle because unlike RoboTaxi, the passenger solves all of those problems. [SPEAKER_00] But in our case, we have to solve that. [SPEAKER_00] So that's how we ended up on this.
SPEAKER_00
Where are you rolling out DOT? [SPEAKER_01] We're primarily testing right now. [SPEAKER_01] We really want to get it right in one market. [SPEAKER_01] We're doing a lot of this in Arizona. [SPEAKER_01] Yeah. [SPEAKER_01] And because it's not just the technology. [SPEAKER_01] Yes, that is one of the things I've learned and come to appreciate about building something like DOT is that these autonomous vehicle companies are almost many companies inside one company, or certainly many different types of skills you have to be good at. [SPEAKER_01] Yes, I think everyone obsesses over the autonomy. [SPEAKER_01] Okay, but there's also the hardware. [SPEAKER_01] Yep.
SPEAKER_00
[SPEAKER_01] There's also the manufacturing.
SPEAKER_01
There's also the operations. There's hardware reliability.
SPEAKER_00
There's also the maintenance. Yeah. There is also the regulatory. Yeah. There are a lot of different components that you actually have to be good at. And then we can talk about the stack required to actually build the inputs to some of these things. Like for example, there's also understanding how do you procure supply when you have sometimes geopolitical tensions? Yes. Or when you have supply chain disruptions? [SPEAKER_01] Okay, but there's also the hardware. [SPEAKER_01] Yep. [SPEAKER_01] There's also the manufacturing. [SPEAKER_01] There's also the operations. [SPEAKER_01] There's hardware reliability. There's also the maintenance. Yeah. There is also the regulatory.
SPEAKER_00
Yeah. There are a lot of different components that you actually have to be good at.
SPEAKER_01
[SPEAKER_00] And then we can talk about the stack required to actually build the inputs to some of these things. [SPEAKER_00] For example, there's also understanding how do you procure supply when you have sometimes geopolitical tensions? [SPEAKER_00] Yes.
Or when you have supply chain disruptions? Where do you do assembly versus where do you do construction? Uh-huh. Not super obvious answers to some of these questions at times, especially when you have to make these decisions sometimes years out. [SPEAKER_00] Yeah. [SPEAKER_00] And so I think that's the stage that we're in right now, which is, okay, we got to figure this out correctly before we can actually scale it. [SPEAKER_00] Where do drones fit in, if at all?
SPEAKER_00
They definitely do. I mean, as I mentioned, back to jobs to be done, I think drones obviously can do a lot of these longer distance orders.
SPEAKER_01
[SPEAKER_00] And so we've been doing drone deliveries actually for a couple of years now, mostly outside of the United States.
SPEAKER_00
Okay. Outside of the U.S. Yeah, places like Australia, we're going to bring them to Europe, bring them to the United States as well. But again, you have all of those problems you have to solve. [SPEAKER_01] Yes, yes. You know, the autonomy is a little bit easier. Yeah. You still have a routing problem, you have hardware problems. Yes. Obviously, you still have permits and regulation. Yeah.
SPEAKER_01
[SPEAKER_00] Set up, loading inside different stores, things like that. [SPEAKER_00] Yeah. [SPEAKER_00] Very interesting. [SPEAKER_00] We're talking a lot about some of these scale tech problems.
SPEAKER_00
And one of the ones that people might not think about is fraud. But I feel like Stripe and DoorDash obviously work together in many ways.
SPEAKER_01
[SPEAKER_00] Yeah.
SPEAKER_00
But one of the things we work together on is fraud. Yes. [SPEAKER_01] And I feel like the number of potential fraud vectors is much more complex than people think. [SPEAKER_01] Yes. Maybe you can just talk about trust and safety at DoorDash. Yes. All the different ways that people try, like, you're running this complex system that people try to game. Yes, yes, yes. And what it takes to run that. [SPEAKER_00] Yeah. I mean, many times I think about my freshman year electrical engineering course on state machines. And where DoorDash in some ways is like a large state machine, right? Where you have many systems in place and they're observing what's happening.
SPEAKER_00
There are things that must happen when things are green to keep them green. But as we start degrading gracefully from green to yellow to orange to red, something like fraud, as you mentioned, other systems have to kick in and do things like exception handling. Obviously, you're spending most of your time building prevention systems. Yeah. But of course, it's tricky. You also have to have the 911 response system that literally responds within minutes because sometimes we're talking about physical safety. We're not just talking about fraud, right?
SPEAKER_00
I mean, given the volumes that DoorDash carries, billion dollars per year, the one in a million incident unfortunately does occur. And so that's DoorDash as a system. Now, in fraud, you're right. We partner, for example, a lot on online fraud.
SPEAKER_01
[SPEAKER_00] I mean, you have the largest database, right, of all of these transactions and therefore you can give us lots of information that we ourselves couldn't do on our own. On the flip side, there's also offline fraud, which is very tricky to catch. [SPEAKER_00] What do you mean by offline fraud? [SPEAKER_00] Okay, for example, let's say that a consumer suggested that an order was never dropped off. [SPEAKER_00] Let's say that a Dasher said that an order at a grocery store was already shopped and picked, but we're not sure. [SPEAKER_00] Or let's say that a Dasher said an item is missing inside of a store, any kind of store, maybe an apparel store.
SPEAKER_01
[SPEAKER_00] Yeah. [SPEAKER_00] All of those, I would argue, have offline components that are difficult to verify. [SPEAKER_00] Yes. [SPEAKER_00] Right, this is building the eval, if you will. [SPEAKER_00] Yes, yes. [SPEAKER_00] For this set of conditions and use cases, it's actually extraordinarily difficult.
SPEAKER_00
And so a lot of what we're trying to do is we have to build those signals ourselves. There is no perfect science here. I wish there were. Yes. But in many ways, we have to invent this. This is actually why. I'll give you a few examples. So one of the things that we shipped, this is actually a couple years ago, was called SafeChat, where we noticed that prior to any physical altercation that may unfortunately happen between audiences, 90-something percent of the time it's always preceded by a verbal altercation. [SPEAKER_01] Knowing that alone allows us to prevent a lot of tough situations. [SPEAKER_01] Or building alert systems.
SPEAKER_00
For example, sadly, there are shootings, particularly in the United States. And there was one shooting in Manhattan where several people died in the lobby of a large office building. But within minutes of a Dasher seeing the shooter walk in to the building, we have an alert system that doesn't just alert all Dashers and consumers and merchants within that vicinity, but also all local law enforcement. And actually, we were the first to report that to the NYPD who tried their best to respond in time. But there are a lot of those events. [SPEAKER_01] And so it's not always about fraud, I guess, is what I'm trying to say.
SPEAKER_00
You have to build extremely responsive systems and you also have to build as many signal detecting systems too. Yes. You're running a fairly large slice of the economy. Yes.
SPEAKER_01
[SPEAKER_00] And you're trying to have everything run smoothly.
SPEAKER_00
And there's quite a lot of failure modes that people might not think about that are possible when you're just seeing so many economic transactions all day. Yes. We are trying to be the- Exactly. We're trying to be the digital representation of these cities, right?
SPEAKER_01
[SPEAKER_00] Whether it's a city, a suburb, a neighborhood, a rural area. [SPEAKER_00] Yes. [SPEAKER_00] And that you have to build extremely responsive systems and you also have to build as many signal detecting systems too. [SPEAKER_00] Yes. You're running a fairly large slice of the economy. [SPEAKER_00] Yes. [SPEAKER_00] And you're trying to have everything run smoothly. [SPEAKER_00] And there's quite a lot of failure modes that people might not think about that are possible when you're just seeing so many economic attractions all day. [SPEAKER_00] Yes. We are trying to be the— [SPEAKER_00] Exactly. We're trying to be the digital representation of these cities, right?
SPEAKER_01
[SPEAKER_00] Whether it's a city, a suburb, a neighborhood, a rural area. [SPEAKER_00] Yes. [SPEAKER_00] And sometimes it's not always of what's transacting, but it's just what activities are occurring.
SPEAKER_00
[SPEAKER_01] Yes. Yes. [SPEAKER_01] One of the hardest kinds of frauds to prevent is the classic one with credit card fraud, one that people think about is your card got stolen and it's actually someone overseas buying stuff for themselves rather than you buying it for yourself. [SPEAKER_01] That we've actually now got very good at detecting. It's quite hard to do. And there's just so much data we can bring to bear on that problem. [SPEAKER_01] A much harder one that we see that businesses face is the kind of thing that in the industry we term friendly fraud, which is a bit of a euphemism.
SPEAKER_00
[SPEAKER_01] But the customer buys something and just says it never arrived when it actually did and they're just straight up lying. But you don't really want to call them on it. You also don't have proof that they're lying. But it definitely does happen to some degree. [SPEAKER_01] And so how do you deal with—I mean, maybe there's a photo of the Dasher having delivered it, but I'm curious how you deal with people just defecting from the system. [SPEAKER_01] There's no one answer, as you know, with fraud, because as soon as you figure out how to measure the risk and contain the risk, obviously the incentive for the fraudster goes towards the next axis of breaking it.
SPEAKER_00
[SPEAKER_01] Yes, yes. Exactly. Exactly. And so I don't think there's a perfect solution to the problems that you're describing. But you're right. A lot of this is about how you build systems, where obviously the metric is around reliability and consistency and great customer outcomes. [SPEAKER_01] The inputs are a lot of measuring things before things happen. I talked about how one of the most important things about logistics is the setup. [SPEAKER_01] That happens even before a delivery, if somebody hits place order, right? The setup is extraordinarily important. Did you get the right catalog? Did you actually label correctly the catalog?
SPEAKER_00
[SPEAKER_01] A lot of that stuff. [SPEAKER_01] Okay. Now, in the case that you're describing, we can track several things. We obviously can track what is happening with the Dasher. [SPEAKER_01] You mentioned some of these ideas, taking photos of receipts or orders being dropped off. We have our own mapping system, for example, that we built. Why do we build our own? [SPEAKER_01] Well, it's because we care much more than any third party mapping system of exactly where the last two feet—forget 20 or 200 feet—of some apartment unit door is, for example.
SPEAKER_00
[SPEAKER_01] And we know if we reliably deliver to that door and we saw the pin actually hit exactly where, we have a little bit more fidelity on whether something was dropped off. [SPEAKER_01] We build profiles of customers. I'm sure you do too, of their behavior and what they tend to say. So there's lots of things that we're trying to do behind the scenes to build these signals to figure out what is the likelihood here of fraud. Yeah. Makes a lot of sense. Tell me about DoorDash Tasks. DoorDash Tasks is something that we shipped recently where it started with a project where we were trying to solve our own problems.
SPEAKER_00
So it started with trying to figure out where is every item inside the city. And so we have millions of Dashers and they're usually frequenting different types of stores. We know that consumers move around items a lot, which makes it extraordinarily difficult for any store to track their own inventory.
SPEAKER_01
[SPEAKER_00] And so Dashers sometimes are collecting this information, right? That was one of the problems that we were solving.
SPEAKER_00
Interestingly, while we were doing this, we started getting calls actually from people you probably would expect—retailers and CPG companies who might be interested in this information. And then, especially as companies—I think it's well known at this point that a lot of the large LLM companies have been building lots of repositories of online information. Well, what about the offline information, to bolster those models or just to help some of these companies building robotics and things of the sort? Well, we said, oh, interesting. Well, okay, we're building a catalog for ourselves, but we ought to be able to help other people too.
SPEAKER_00
And if it's an opportunity to help Dashers earn more or give them more choices to earn more, great. Why not build that solution? And so that's really the story of DoorDash Tasks, which started organically, probably a couple of years ago as we were solving our own problem. And we started realizing that there may be other people who have similar tasks. And so it is a platform for having fairly small tasks done. You can give the task to DoorDash and you guys could complete it or— Yeah. Do you get excited about an AR angle for DoorDash where you use the Meta glasses where you can get directions within the store and everything?
SPEAKER_00
You could actually speed things up quite a bit rather than wandering around lost. Yeah, I think we could be. But again, back to the question of asking what problem does this solve, right? Yes. The human is pretty good with their eyes at some of this stuff. So the bar is pretty high in order to do some of the things you're talking about. Yeah. As I just think through AI applications for DoorDash, one of the things I'm struck by is that the LLMs are pretty good recommenders just by tossing things into context.
SPEAKER_01
[SPEAKER_00] You don't need to train a custom model, but I don't know if you've ever tried for book recommendations or TV recommendations. [SPEAKER_00] You just tell it a bunch of stuff you already like. Restaurant recommendations—here are 15 restaurants we like to go to. Give us other recommendations and it'll do a really nice job.
SPEAKER_00
And yet within products, if I open DoorDash, it's the same categories and things like that. And it's less personalized to me than if I took my DoorDash history and put it into an LLM. Isn't that something we should be using the fact that LLMs are pretty good recommenders within products? It's not just DoorDash. It's every product I use, and it feels like those recommender capabilities are underutilized. No, I think you're definitely right that there's an opportunity here where there's almost the traditional school of thought, which is to use the information that you have, right?
SPEAKER_00
And yet within products, if I open DoorDash, it's the same categories and things like that. And it's less personalized to me than if I took my DoorDash history and put it into an LLM. Isn't that something we should be using? Shouldn't we be somehow using the fact that LLMs are pretty good recommenders within products? It's not just DoorDash. It's every product I use. It feels like those recommender capabilities are underutilized. No, I think you're definitely right that there's an opportunity here where there's almost a traditional school of thought, which is to use the information that you have, right?
SPEAKER_00
Right? And you build the best personalized models that you can. And one of the things that LLMs obviously does is it throws efficiency out the window, right? And it throws as much compute towards it. And interestingly enough, one of the things that spits out when you put in enough tokens and have big enough context windows is you're right. It has actually better models because it's just using much larger data sets. Yes. And it's a world model. And it's a world, exactly. And so I do think there's an opportunity in what you're saying, which is that products like DoorDash, consumer products, will definitely have their own ordering agents.
SPEAKER_00
And I think we're all trying to figure out what is the right modality, right? Because it's not obvious to me that everything's going to be done through text. We don't buy things through text. Yes. And we don't always get inspired through text either. And so I think it's something that we're all figuring out. What else are you excited about these days from a product point of view? What's a new part of the product that is close to your heart or where do you want to take things?
SPEAKER_00
Well, we have a few missions, right, that we're on. And we talked about several of them in this conversation. One of them is we got to bring you everything inside the city. And we're a long, long, long ways from that. We can go super deep on restaurants and food. But as you start going into category N plus one, we are just a smaller and smaller drop in the ocean. We got a lot of work to do. Mm-hm. The second mission, obviously, is we also want all of the businesses that we support to have their own software. DoorDash's goal is not just to grow your business by sending you customers.
SPEAKER_00
We also want you to learn how to do it on your own. And that's why we have products like DoorDash Drive or Storefront or Seven Rooms, which are really B2B products, which is probably why consumers don't think of us for them, and help you build your own omni-channel business. We have a mission in which we want to actually bring you inside stores. That's something we're trying to do, right? And we started that about a year ago.
SPEAKER_01
I mentioned earlier that one of the perennial challenges or trends for restaurants is how do you grow your own brand?
SPEAKER_00
[SPEAKER_01] Well, if we can also help you with that, both by helping build for you a CRM of a 360 view of guests where we can also send you customers inside stores, we'd love to do that. [SPEAKER_01] We're starting with restaurants with two products. One is called Going Out, the other is Reservations. That's a big mission that we're on. [SPEAKER_01] And so we have several of these missions that I'm pretty excited about. Yes, yes. You mentioned Reservations. There's a number of quite established companies in that space. And restaurants are famously not exactly eager to wake up and switch all their systems one morning.
SPEAKER_00
So how do you plan to unseat the existing guys in Reservations? Well, I think it starts with the idea that I believe no restaurants should own their own reservations technology, ideally. It starts with that. Reservations book, we can get into super deep here. It's actually quite complicated to run a book. I mentioned earlier this idea that restaurants' North Star really should be to build regulars. Yes. Right. But that's not how every reservation system is designed. And so I actually think the most important thing is that restaurants can have reservations on any platform. That's what I believe.
SPEAKER_00
Mm-hm. And so that's one of the main premises behind Seven Rooms. It's that it's agnostic to who generates the demand for you. What it's trying to do is make sure it achieves your objective function. It may be to grow profits one year, it may be to grow locations the next year, maybe to get a certain type of customer the next year, and so forth. And so I think it starts by building what's best for the merchant. And then hopefully DoorDash can make a difference to where we just have more customers than people that work with restaurants and also more information that we can supply to these restaurants on how do you make more money to achieve whatever outcome you want. And so if we can help achieve a restaurant's objective function better than anyone else, well then hopefully we have a seat at the table.
SPEAKER_00
Talk in reservations, they carved out a successful niche in high-end reservations. And I think about one of the beliefs that informed their products most strongly was that no-shows are terrible for restaurants. And a restaurant reservation should be like a flight reservation, where you don't just get to decide you're not going to go to the restaurant. [SPEAKER_01] Put a little deposit. [SPEAKER_01] Yeah, exactly. You put a little deposit down. Do you subscribe to that philosophy? Do you think it's maybe less relevant? They were really dealing with very high-end restaurants. Do you think it's less relevant for regular restaurants?
SPEAKER_00
[SPEAKER_01] I'm just curious what you think of that viewpoint. That was, I think, a founding insight of Tock. [SPEAKER_01] I think it makes a ton of sense. The implementation of the idea is what's difficult, right? Restaurants that have very limited seating and very long seatings, the opportunity cost for a cancellation is very high versus a restaurant that may have infinite production capacity. So I think the implementation idea... [SPEAKER_01] Yeah, I think the implementation of the idea is what matters, but I think the idea itself makes a ton of sense. [SPEAKER_01] How do you plan to ensure that people aren't no-showing to restaurants with reservations?
SPEAKER_00
[SPEAKER_01] Well, we're working on that problem right now, but I don't think there is one thing. I think the first thing is we have to help you find reservations that you want to go to.
SPEAKER_01
I think there's a lot of room left in the space to innovate there. I don't think there's been that much innovation in that area.
SPEAKER_00
[SPEAKER_01] So discovery is almost a bigger problem.
SPEAKER_01
I think discovery is very difficult. How do you find out about restaurants today? I'm curious.
SPEAKER_00
My wife finds them on Instagram. Yeah, okay. Yeah, and I think that's right, because there are so many different sources now. Instagram is one, I'm sure other social channels are another. LLMs you mentioned earlier about putting things in there and getting something out. Friends, I'm sure. [SPEAKER_01] I think there's a lot of room left in the space to innovate there. I don't think there's been that much innovation in that area. [SPEAKER_01] So discovery is almost a bigger problem.
SPEAKER_01
I think discovery is very difficult. How do you find out about restaurants today? I'm curious.
SPEAKER_00
My wife finds them on Instagram. Yeah, okay. Yeah, and I think that's right, because there are so many different sources now. Instagram is one, I'm sure other social channels are another. LLMs you mentioned earlier about throwing things in there and getting something out. Friends, I'm sure. I think it's really difficult still. When I think about it, no matter the sources of input, most restaurants still struggle generating their own demand. Yeah. And so I think that's a place where I think we have a shot at making a difference. Yes. You talked about your European expansion. You just acquired Deliveroo. In what ways are the Deliveroo and DoorDash businesses different?
SPEAKER_00
Well, fundamentally, they're more of the same. I started with that, actually. Hence the acquisition. Instead of the, yeah. But, okay, well, we talked a lot about systems and logistics. Have you been to London? I'm sure you've probably been there many times. You probably know it better than I do. But it is an interesting city in that it doesn't actually have a lot of the grid-like, hub-and-spoke properties of a lot of cities. Yes.
SPEAKER_01
[SPEAKER_00] And there's a lot of reasons for that. I know we can go into the history. [SPEAKER_00] It's mostly age, but yes. [SPEAKER_00] Yeah. But there are other cities that were actually designed differently in other parts of Europe, actually. We can get into other countries and cities. But age is one of them. Obviously, it's not meant to be a city where you drive a lot of vehicles. [SPEAKER_00] Yes, yes. [SPEAKER_00] No vehicles are managed. [SPEAKER_00] But I think it's older than even a lot of other European cities. [SPEAKER_00] It is.
SPEAKER_01
[SPEAKER_00] Even as European cities go, it's really old. [SPEAKER_00] Yes. And as a result, that alone makes the logistics problem very, very different. And the logistics, not just the algorithm, which I think is just one part of the system, but the signals that you'd want to collect are very, very different. [SPEAKER_00] Vehicles are very different. We predominantly are non-autos in the city of London, which is very different in the States, as an example.
SPEAKER_01
[SPEAKER_00] That's very different. The regulatory setup is different. It has parts that rhyme with the U.S., but as you well know, each country is slightly different, even though, I guess, the U.K. is not under the EU. But even within the EU, each country has their own local version of regulation. [SPEAKER_00] That's very, very different. You know this probably better than anyone in the world. Payment processing is very different. There are many more card types in parts of Europe than in the U.S. Industry dynamics on retail are very different. In the U.S., we have a fragmented retail industry that has a lot of different players.
SPEAKER_01
[SPEAKER_00] That's more concentrated in the U.K.? [SPEAKER_00] Yeah, in the U.K., in Germany, in France, in a lot of European countries, this is more the norm than the exception.
SPEAKER_00
Whereas in the U.S., you have maybe hundreds of different big brands that are strong in certain regions. But in Europe, that's less true. Those are some of the immediate differences that come to mind. A mystery to me is why the pharmacies are so much better in the U.K. versus the U.S. You go into a Boots versus you go into a CVS or Walgreens, and it's night and day. Yeah, well, one of the things I would say, just as a standard matter, is because of the concentration. And it's really concentrated by category. Pharmacies can be a category. Certain apparel can be another category, et cetera. And this is true in Australia. This is true in Germany.
SPEAKER_00
The standards are higher and they're more consistent of that service. But where in the U.S., when you have tens of thousands of supermarkets, hundreds of big brands, it's different. It's different. And then if you look even more upper funnel, say, CPG, there's a lot more CPGs in the U.S. market that are competing than in some of these other countries, which make things like inventory management, the SKU count, the size of the stores, all of that, therefore, very different. Yeah. You're referring to some of the stuff we're doing together. I think of Stripe and DoorDash as almost having grown up together, founded at very similar times.
SPEAKER_00
And then you guys were early users of all manner of products, be it TypeConnect or Radar or issuing for cards or things. [SPEAKER_01] What would you like to see Stripe do that it doesn't today? [SPEAKER_01] Either because you guys would like to use it or just because you think it's something we should be doing. [SPEAKER_01] I've been giving you all my silly product suggestions. [SPEAKER_01] This is where you get to turn the tables and give me yours. [SPEAKER_01] I would always start with what our teams would say. So probably the first piece of advice always is, what problems are you solving for us, right?
SPEAKER_00
Because I think especially as companies grow in size, success, variety of products, I think there's a natural temptation to start imposing what the companies want to do or want to solve or want to sell versus what problem does it solve for the customer? So I am sure one of the things that could be true is making sure that you're solving our top problems versus just introducing the range of products. [SPEAKER_01] The next thing. [SPEAKER_01] That's probably one thing that we probably both share as advice for one another. [SPEAKER_01] Oh, wow. [SPEAKER_01] We got Dot coming. [SPEAKER_01] Oh, awesome. [SPEAKER_01] So this is Dot? [SPEAKER_01] This is Dot.
SPEAKER_00
[SPEAKER_01] Well, there you go. [SPEAKER_01] Wow. [SPEAKER_01] It's a TARDIS. It's very cute. But I can't believe that we actually have Dot with us today. And it's traveling backwards. But here you go. So you can see it there. The LED screen is for the delivery. Yeah, the LED. Yeah, exactly.
SPEAKER_00
Where we can send different messages. We can even give messages through the eyes, actually. We thought a lot about the eye contact between Dot and a human. [SPEAKER_01] And you see, part of the sensing staff there in terms of the cameras, the lighter up there. This is a lot bigger than I expected. But I can't believe that we actually have Dot with us today.
SPEAKER_01
[SPEAKER_00] And it's traveling backwards. [SPEAKER_00] But here you go. [SPEAKER_00] So you can see it there. [SPEAKER_00] The LED screen is for the delivery.
SPEAKER_00
Yeah, the LED. Yeah, exactly. Where we can send different messages. [SPEAKER_00] We can even give messages through the eyes, actually. We thought a lot about the eye contact between Dot and a human. [SPEAKER_01] And you see, part of the sensing staff there in terms of the cameras, the lighter up there.
SPEAKER_00
This is a lot bigger than I expected. It's like a small car, not a big robot.
SPEAKER_00
Yes.
SPEAKER_01
[SPEAKER_00] Although it's still probably. [SPEAKER_00] Like a smart car. [SPEAKER_00] Probably. [SPEAKER_00] Yeah, it's about one-tenth the size of a car. [SPEAKER_00] But it can travel up to 20 miles an hour. And so when you think about how that compares to cars traveling in traffic, it's about the same. Yeah. [SPEAKER_00] And. [SPEAKER_00] Oh, wow.
SPEAKER_01
[SPEAKER_00] This is how we load it up.
SPEAKER_00
We got you some non-alcoholic Guinnesses. We got some. I've had Tato's. I actually have not had Tato's. Ireland's preferred here. I have some of those. These are the chips. These are the potato chips. Yeah, yeah. Very good. Hmm. That's cool.
SPEAKER_00
That's awesome. But the compartment is totally custom and modular, which means that depending on your needs or what we want to fit, whether it's heating units, cooling units, all of that can be configurable as well as built modularity. But this is DOT. Where will this first be most useful? There are a lot of deliveries where you can think of suburban-like environments where the deliveries are probably under five miles. [SPEAKER_01] Yeah. [SPEAKER_01] And there's some challenge for a dasher. [SPEAKER_01] For example, parking. [SPEAKER_01] We talked a lot about earlier. [SPEAKER_01] So it's suburban. It's a great place first. Yeah.
SPEAKER_00
And then I think certain city centers, depending on the actual area, though.
SPEAKER_01
[SPEAKER_00] Right. [SPEAKER_00] And so there's a lot of those are the two types that we're thinking about—distance and the types of. One of the coolest things that we're actually building in DOT that's not physical is what we're calling our autonomous development platform, which is the algorithm that talks about which orders go to which type of vehicles.
SPEAKER_00
Right. So DOT, for example, can also travel mixed routes with humans. Right. For example, if it's a longer distance delivery, but there is a part of that journey where DOT is more advantaged, say, parking. Yeah. It can do the first leg of the order. And so thinking. First leg and then hand it off to a dasher. And so thinking carefully about. Can it run the roads? Yes. Okay.
SPEAKER_00
And so thinking. [SPEAKER_01] And the sidewalks too. [SPEAKER_01] And the sidewalk and the bike lane. [SPEAKER_01] And so it's the only vehicle in the world that does that. And so thinking carefully about the handoffs is very important to actually making autonomy work.
SPEAKER_01
[SPEAKER_00] Because this is very different from robo taxis. Yeah. Where obviously a passenger can solve a lot of these edge cases. But we actually have to think about all of it. Yes.
SPEAKER_00
[SPEAKER_01] But I actually have no idea. [SPEAKER_01] This is cool to see DOT here. How far can it go on a single charge? Or how many deliveries really is it? Yeah. It could do hundreds.
SPEAKER_01
Oh, really? [SPEAKER_00] Yeah. [SPEAKER_00] It really. [SPEAKER_00] But we probably wouldn't test it to failure, so to speak. [SPEAKER_00] And so a lot of this is making sure. [SPEAKER_00] How do you actually build. [SPEAKER_00] We talked about one of the skills you have to do in building autonomous vehicles is you have to build it ready for mass manufacturing. [SPEAKER_00] Yep. And so you also have to build it for easy operations. [SPEAKER_00] So the swapping in and out of the right vehicle parts is very important.
SPEAKER_00
And where the battery. [SPEAKER_00] Like all the batteries? Exactly. And so there's some compute in there. There's some batteries in there. There's some more sensors. But yeah. And the autonomy is all local. [SPEAKER_01] Yeah. [SPEAKER_01] On the device. [SPEAKER_01] Yeah.
SPEAKER_01
There's a lot of other things that we're going to have to keep doing to test DOT in different types of weather.
SPEAKER_00
There's a much more sophisticated sensor stack than I expected. Well, if you're traveling the road and you're going up to 20 miles an hour. Yeah, I guess you need it. There's some physical parameters that you're solving for, which guides the development of the actual stack. But you're right in saying that. Just when you see it, it's surprising. It's not a baby sensor stack. It's not a baby sensor stack.
SPEAKER_01
[SPEAKER_00] It's a real sensor stack. [SPEAKER_00] Okay, yeah.
SPEAKER_00
Well, yeah. Well, we're not trying to build any particular technology. We're just trying to make it work. Is the fan the fridge or the compute? The compute. But yeah. But there's a lot of different versions that we're working right now, both in terms of what the temperature settings could be internally, what the heating systems are, and making sure that we don't overheat. There's some interesting braking systems that we're building as well in DOT. So why are the braking systems interesting? Okay, yeah. Well, yeah. Well, I guess we're not trying to build any particular technology. We're just trying to make it work. Is the fan the fridge or the compute? The compute.
SPEAKER_00
But yeah. There's a lot of different versions that we're working right now, both in terms of what the temperature settings could be internally, what the heating systems are, and making sure that we don't overheat. There's some interesting braking systems that we're building as well, too, in DOT. So why are the braking systems interesting?
SPEAKER_00
Well, a lot of the question is what types of brake are you going to make, that makes sure that at different speeds or in different types of weather that you can actually make sure that you stop on a dime, especially if you're not going just on the road. For example, if you're going on the sidewalk or when you're making a turn. You need to be able to stop much more suddenly. [SPEAKER_01] Yes, or if you're going to move from, say, the bike lane into the sidewalk or any quick turn like that. Those are the types of things that are more sensitive.
SPEAKER_00
Doss, you're dismissed. You did great. See you, DOT. Good robot. That's so cool. These are really good, by the way. They're good, right? I've never had Tato. Yeah, there you go. Wait, you're saying this is like... This is Ireland's... Is this the... This is Ireland's potato chips or... No.
SPEAKER_01
[SPEAKER_00] Yeah, it's the Lay's Chips of Ireland. Mm-hmm. [SPEAKER_00] Mm. Okay, so... Delicious. Very good. And I'm introducing you to all my culture. Oh, yeah, we were talking about...
SPEAKER_00
What were we talking about? One of the things I'll never forget talking to you and Patrick about as we kind of grew up together in the years of building our companies was, I think you've always... Both of you have always had the idea that Stripe is a technology company that happens to be in payments. Yes. It's not a payments company. And you've always challenged, I remember, your customers to think about, don't just think about accepting payments and there's more that you can do. So I am curious, what more can we do, should we be doing with things like crypto or stablecoins?
SPEAKER_00
Two topics that are on the minds of all our customers today are stablecoins and then AI specifically with respect to changing buying and agentic commerce. On stablecoins, I think maybe DoorDash is not where I would start. Two places that we're seeing tons of interesting stuff is, one, any kind of cross-border use case where if you want to send money to 100 countries, it's already the case that stablecoin is a much better way to do that than anything else. And that's where we're seeing a ton of adoption where just that long tail coverage and they really work for that.
SPEAKER_00
[SPEAKER_01] The second, and this is where Tempo, our new initiative that you guys were nice enough to work with us on, is coming in, is very scalable crypto payments. And, obviously, agents is what we have in mind as we're developing Tempo, where if you want to pay for your API consumption or if your agent wants to be able to pay for things around the internet, you actually need a really good scalable blockchain for that.
SPEAKER_00
[SPEAKER_01] Okay, so that's all the crypto side of things. The other thing that we're thinking about a lot is just how does commerce change now that people's expectations are increasingly they ask their AI for stuff. And so it feels like you should be able to ask your AI, whether that's ChatGPT or Gemini or whether that's Siri or whatever your interface is to AI. [SPEAKER_01] Sure. [SPEAKER_01] It's like, let's just order again what we ordered on Sunday. You should be able to make that natural language query and have it take care of interfacing with DoorDash and payment and everything like that. And I'm curious how you guys think about the interface changing.
SPEAKER_00
I mean, you thought a lot. Do you want to enable people to order within the AI apps? Do you want to have just more of a natural language input to DoorDash? Just how is that going to happen, given that that is presumably what people want in terms of the low friction AI experience?
SPEAKER_00
Yeah, well, I think what people want is definitely low friction, but I think people also want the products to show up on time and think they want. You only get a right to do this cool UI stuff if the logistics is right. And the challenge with a product like DoorDash is you have to do the whole thing end to end or you have to have great coordination or communication mechanisms. And so we definitely agree with you that I think there's definitely going to be a place where in the future, as these AIs develop their app ecosystems, relationships, I think, with companies like ourselves that can do exactly what you just said, do the jobs to be done in their regular life.
SPEAKER_00
[SPEAKER_01] I think that will be a source of top of funnel for us. I think the hard part is making sure that we can actually deliver on the promise. You know, sometimes in a cautionary tale of the past, I remember services, Google food ordering launched in, I forget, 2015 or 16. And they allowed you to order delivery, for example, from various Google surfaces, Google Maps, Google Search, etc. And while on the one hand, it was low friction and they could send lots of traffic, they couldn't get the retention. And this is where we're talking about consumer businesses and retention being the name of the game. And the reason was because they didn't know how to contact the driver. They didn't know if the driver couldn't find you, if something was taking a little bit longer, if something was out of stock.
SPEAKER_00
So there's a lot of things that happened after the checkout button. And I think this is one thing, back to what we were talking about earlier about what is the correct UI. It's not obvious to me that it's just a chat interface. There are all of these different components that have to be solved. And so I think the way I think about it is, okay, regardless of whatever we ship, whether it's on our own surface, other people's surfaces, are we solving the end-to-end job? [SPEAKER_01] If we are not solving the end-to-end job, it's not going to matter. [SPEAKER_01] Last question. So there's a lot of things that happened after the checkout button.
SPEAKER_00
And I think this is one thing, back to what we were talking about earlier about what is the correct UI. It's not obvious to me that it's just a chat interface. There are all of these different components that have to be solved.
SPEAKER_01
[SPEAKER_00] And so I think the way I think about it is, okay, regardless of whatever we ship, whether it's on our own surface, other people's surfaces, are we solving the end-to-end job? If we are not solving the end-to-end job, it's not going to matter. Last question.
SPEAKER_00
What is food that you can get in other places when you visit London, when you visit some other city that you wish you could get in the Bay Area but you can't? Actually, I really like tea sandwiches.
SPEAKER_01
[SPEAKER_00] I was literally in London. [SPEAKER_00] And for whatever reason... Afternoon tea? Yeah, little cucumber sandwiches. Which is, I'm always looking for a healthy snack in the afternoon. [SPEAKER_00] Today I had an awesome one, thanks to you.
SPEAKER_00
[SPEAKER_01] Healthy snack? No, delicious, delicious, delicious. [SPEAKER_01] Have you done the proper afternoon tea with the three-level platters and the little cakes and everything? I did it once with my kids, a couple of summers ago. That was an experience.
SPEAKER_01
[SPEAKER_00] I think in part because it was new to me and my kids and in part because I had kids with me, playing with all the different things that they gave us.
SPEAKER_00
But yeah, I think there's something really interesting about some of the grocery stores, for example, in European markets. Prepared meals is a massive focus. [SPEAKER_01] Massive. And we have some of that here in the U.S., to be fair. But in London, I just found myself finding that in every store as I went to shop. You would see so many options. [SPEAKER_01] There's a few of these things that I find that are so much better back home in Ireland, the U.K., Europe. [SPEAKER_01] Prepared food is one of them. A sandwich you get in Heathrow is probably pretty good. [SPEAKER_01] A sandwich you get in JFK, don't go there.
SPEAKER_01
[SPEAKER_00] And on a shelf in a shop.
SPEAKER_00
[SPEAKER_01] And some of the stores we have, the cookies, obviously, much better back home. There's some delicious cookies, yeah. [SPEAKER_01] The teas, there's a lot more choices of teas inside restaurants, I found. Yeah, it's been one of the coolest parts and greatest privileges, frankly, that I have at DoorDash. Because we get to interface with all the businesses of all these different wonderful cities and really get to meet the people who are building the GDP of those cities. It's not just the cool economic impact that they're having, but you get to find out about all their passion projects. [SPEAKER_01] Yeah. [SPEAKER_01] You get to find out whether it's...
SPEAKER_00
Everyone is passionate about this stuff. Everyone's passionate about something.
SPEAKER_01
[SPEAKER_00] And that's one of the coolest things about my job, where I don't just answer questions about different IP and process and things like this. [SPEAKER_00] I promise you there is that for every single business inside every city. Yeah, yeah. It's a cool job where you get to work with people who are incredibly passionate about what they do all day long.
SPEAKER_00
Yes. Yeah. Well, Tony, thank you. [SPEAKER_01] Thanks so much, John. Thank you. Just when you see it, it's kind of surprising. It's not a baby sensor stack. It's not a baby sensor stack. It's like a real sensor stack. Okay, yeah. Well, yeah. Well, I mean, I guess, you know, we're not trying to build any particular technology. We're just trying to make it work. Is the fan the fridge or the compute? The compute. But, yeah. But, you know, there's a lot of different versions that we're working right now, both in terms of what the temperature settings could be internally, what the heating systems are, you know, and making sure that we don't overheat.
SPEAKER_00
There's some interesting braking systems that we're building as well, too, in DOT. So why are the braking systems interesting? Well, you know, a lot of the question is, like, what types of brake are you going to make, you know, that makes sure that at different speeds or in different types of weather that you can actually make sure that you stop on a dime, especially if you're not going just on the road. For example, if you're going on the sidewalk or when you're making a turn. You need to be able to stop much more suddenly.
SPEAKER_01
Yes, or if you're because if you're going to move from, say, the bike lane into the sidewalk or any sort of, you know, quick turn like that.
SPEAKER_00
Those are the types of things that are more sensitive. Doss, you're dismissed. You did great.
SPEAKER_00
See you, DOT. Good robot.
SPEAKER_00
That's so cool. These are really good, by the way. They're good, right? I've never had Tato. Yeah, there you go. Wait, you're saying this is like... This is Ireland's... Is this like the... This is Ireland's potato chips or... No. Yeah, it's the Lay's Chips of Ireland.
SPEAKER_01
Mm-hmm.
SPEAKER_00
Mm. Okay, so... Delicious. Very good.
SPEAKER_01
And I'm introducing you to all my culture. Oh, yeah, we were talking about...
SPEAKER_00
What were we talking about? One of the things I'll never forget talking to you and Patrick about as we kind of grew up together in the years of, you know, building our companies was, you know, I think you've always... Both of you have always had the idea that, you know, Stripe is a technology company that happens to be in payments. Yes. It's not a payments company. And, you know, you've always challenged, I remember, you know, your customers to think about, don't just think about accepting payments and, you know, there's more that you can do. So I am curious, what more can we do, should we be doing with things like crypto or stablecoins?
SPEAKER_00
Two topics that are on the minds of all our customers today are, yes, stablecoins and then AI specifically with respect to changing buying, you know, agentic commerce. On stablecoins, I think maybe DoorDash is not where I would start. Two places that we're seeing tons of interesting stuff is, one, any kind of cross-border use case where if you want to send money to 100 countries, it's already the case that stablecoin is a much better way to do that than anything else. And that's where we're seeing a ton of adoption where just that long tail coverage and they really work for that.
SPEAKER_01
The second, and this is where Tempo, our new initiative that you guys were nice enough to work with us on, is coming in, is very scalable crypto payments. And, obviously, agents is what we have in mind as we're developing Tempo, where, you know, if you want to pay for your API consumption or if your agent wants to be able to pay for things around the internet, you actually need a really good scalable blockchain for that. Okay, so that's all the crypto side of things. The other thing that we're thinking about a lot is just how does commerce change now that people's expectations are increasingly, they ask their AI for stuff.
SPEAKER_01
And so it feels like you should be able to ask your AI, whether that's, you know, ChatGPT or Gemini or whether that's Siri or, like, whatever your interface is to AI. Sure. It's like, let's just order again what we ordered on Sunday.
SPEAKER_00
You should be able to make that natural language query and have it take care of interfacing with DoorDash and payment and everything like that. And I'm curious how you guys think about the interface changing. I mean, you just thought a lot. Do you want to, like, enable people to order within the AI apps? Do you want to have just more of a natural language input to DoorDash? Just how is that going to happen, given that that is presumably what people want in terms of the low friction AI experience? Yeah, well, I think what people want is definitely low friction, but I think people also want the products to show up, you know, on time and think they want.
SPEAKER_00
You only get a right to do this cool UI stuff if the logistics is right. And the challenge with a product like a DoorDash is you kind of have to do the whole thing end to end or you have to have, you know, great coordination or communication mechanisms. And so, you know, we definitely agree with you that I think there's definitely going to be a place where in the future, as these AIs develop their, whatever we want to call them, app ecosystems, relationships, I think, with, you know, companies like ourselves that can exactly what you just said, like, do the jobs to be done in their regular life.
SPEAKER_01
I think that will be a source of top of funnel, you know, for us.
SPEAKER_00
I think the hard part is making sure that we can actually deliver on the promise.
SPEAKER_01
You know, sometimes in a cautionary tale of the past, you know, I remember services, you know, Google food ordering launched in, I forget, 2015 or 16. And they allowed you to order delivery, for example, from various Google surfaces, you know, Google Maps, Google Search, etc. And while on the one hand, it was low friction and they could send lots of traffic, they couldn't get the retention. And this is where we're talking about consumer businesses and retention kind of being the name of the game. And the reason was because they didn't know how to contact the driver.
SPEAKER_01
They didn't know if the driver couldn't find you, if something was taking a little bit longer, if something was out of stock.
SPEAKER_00
So there's a lot of things that happened after the checkout button. And I think this is one thing, you know, back to what we were talking about earlier about what is the correct UI. It's not obvious to me that it's just a chat interface. That there are, you know, all of these different components that have to be solved. And so I think, you know, the way I think about it is, okay, regardless of whatever we ship, whether it's on our own, you know, surface, other people's, you know, surfaces, are we solving the end-to-end job?
SPEAKER_01
If we are not solving the end-to-end job, it's not going to matter. Last question.
SPEAKER_00
What is food that you can get in other places when you visit London, when you visit some other city that you wish you could get in the Bay Area but you can't? Actually, I really like tea sandwiches. I was literally in London. And for whatever... Like afternoon tea?
SPEAKER_01
Yeah, like little cucumber sandwiches. Which is like, I'm always looking for like a healthy snack in the afternoon.
SPEAKER_00
Today I had an awesome thanks to you. Healthy snack? No, delicious, delicious, delicious. Have you done the proper afternoon tea with like the three-level platters and the little cakes and everything? I did it once with... I took my kids, you know, a couple of summers ago. That was an experience. I think in part because it was new to me and my kids and in part because I had kids with me, you know, playing with all the different things that they gave us. But yeah, no, I think there's... Yeah, one of the things that's really interesting about some of the grocery stores, for example, in European markets is, you know, prepared meals is a massive focus. Massive.
SPEAKER_00
And, you know, we have some of that here in the U.S., to be fair. But in London, I just found myself finding that in every store as I went to shop, you know, you would see so many. No, there's a few of these things that I find that are so much better back home in Ireland, the U.K., Europe. And prepared food is one of them. Like a sandwich you get in Heathrow are probably pretty good.
SPEAKER_01
A sandwich you get in JFK, don't, you know, don't go there.
SPEAKER_00
And like, you know, on a shelf in a shop.
SPEAKER_01
And yeah, some of the stores we have, the cookies, obviously, much better back home. There's some delicious cookies, yeah. There's some... The teas, there's a lot more choices of teas inside restaurants, I found.
SPEAKER_00
Yeah, it's been... I think one of the coolest part and, you know, greatest privileges, frankly, that I have at DoorDash is, you know, because we get to interface with all the businesses, you know, of all these different wonderful cities, and really, like, get to meet the people who are building the GDP of those cities. It's not just like the cool economic impact that they're having, but you get to find out about all their passion projects. Yeah.
SPEAKER_01
You get to find out whether it's...
SPEAKER_00
Everyone is passionate about this stuff. Everyone's passionate about something. And that's one of the coolest things about my job, where I don't just... You know, you ask me a bunch of questions about, you know, different IP and process and things like this. I promise you there is that for every single business inside every city.
SPEAKER_01
Yeah, yeah. It's a cool job where, yeah, you get to work with people who are incredibly passionate about what they do all day long.
SPEAKER_00
Yes. Yeah. Well, Tony, thank you. Thanks so much, John.
SPEAKER_00
Thank you.