There is only one delivery dude in this industry, and he’s the CEO and founder of the namesake Delivery Dudes, a Florida-based regional restaurant delivery surface that claims to be on the verge of profitability as it explores bringing CBD (a derivative of cannabis) product delivery to its network of 500,000 customers.
Jayson Koss, who signs every email with The Big Lebowski quote “the dude abides,” is known for his sharp criticism of the large-scale delivery providers. He reserves his most acerbic scorn for DoorDash, the largest U.S.-based delivery provider that is now valued at more than $12.6 billion after successive investment rounds.
The brand has a funny website that says, “Humans are cool. Robots are cold.” Delivery Dudes also tells customers that its mission is “to make life better, one delivery at a time. Our dream is for us to be best friends and go on vacation together.”
We recently spoke with El Duderino in Chief for an update on his company’s growth, how the regional delivery brand is achieving profitability, his coming expansion into CBD and, eventually, THC, and his take that the largest national delivery brands are “a giant house of cards.”
The following is a Q&A with Koss, lightly edited for clarity and brevity.
Food On Demand: How is 2019 treating Delivery Dudes so far?
Jayson Koss: We’re finally growing year over year, not putting up DoorDash numbers, but all I want to do is become more entrenched in my existing market and become profitable, which I’m teetering on being profitable. That’ll be a news story.
Food On Demand: As you get closer to overall profitability delivering meals, why diversify into CBD and THC (the version with a psychoactive compound)?
Jayson Koss: We surveyed 20,000 of our customers and asked them how likely they’d be to get CBD and THC delivered, and 39 percent of them said they would get it delivered from us. If we delivery to 1 percent [of them], we will be the largest CBD provider in South Florida. I don’t even have to spend money on new customer acquisition.
FOD: Would your drivers be delivering meals and these other products simultaneously?
JK: It’s a completely different model. Drivers are taking 20 orders at a time, drop, drop, drop, drop and back to home base. It’s a different model when it comes to that situation. We’re going to use the same drivers, but they’re going to be working for both companies at different times.
FOD: Could this lead to taking your eye off the ball on the restaurant side of your business?
JK: We have to get better at delivering food, but what did we really build? We are a marketing-and-distribution company. We have 500,000 customers that know us and trust us. We bring stuff to people’s doors, we get into people’s houses, they order from us two to three times a month. What else can we sell them? What else can we do? We can do what Amazon can’t even do in South Florida, which is delivering things in under 30 minutes, so what do you want?
FOD: You created some waves at the Food On Demand Conference last April by directly attacking DoorDash. Have your feelings softened with time?
JK: Everyone is waiting for DoorDash to go public and produce their financials so the market can beat the shit out of them and they can stop just burning [expletive] cash and then things can start to even out again. At this point everyone is just like, drop your pants, show us your financials. We know that you can’t pay drivers the way that you are, we know you can’t give the customers what you’re giving them, so at what point are you going to do this? How many $5 and $10 off coupons can I get in my mailbox for Wendy’s?
FOD: What’s your strategy for weathering this storm of intense competition from hugely capitalized national players?
JK: As long as I can cockroach this out, then I’ll be a cockroach and I’ll just exist. Be profitable, hunker down and just do what we do best and stay entrenched in our existing markets, just hold on and build other verticals that we can make money on. Then, when the smoke clears and DoorDash has to become a real company … then you come out of the woodwork and you come out swinging again.
FOD: Speaking of IPOs, what’s your take on Uber, especially after such a rough quarterly result?
JK: I think Uber has staying power as long as they don’t keep losing $5 billion a quarter. Uber is not only bigger [than DoorDash], their economies of scale are larger and they have every driver already. At the end of the day, they can always win because of that. They have more customers and more drivers.
FOD: With all the M&A in this space, why hasn’t Delivery Dudes been acquired by a larger player?
JK: A lot of people have tried to acquire us, we’ve actually gotten really close with a couple people and it just wasn’t right. There were a lot of times that I probably should have or could have made the move, and I wasn’t sophisticated enough and just wasn’t ready for it.
FOD: Beyond CBD and THC, what other verticals might you consider?
JK: You watch [convenience store delivery brand] GoPuff, that’s working. Cool, so why don’t we start a higher-end version of it geared toward our demographic, Dude’s Bodega. I actually like GoPuff’s model. I think it makes a lot of sense, and now you have these small micro distribution centers and people want to pay you a ridiculous amount of money just for product placement and the amount of venture money and private equity money getting pumped into snacks and beverages.
FOD: How do your strong views on the biggest delivery players translate into how you work with restaurants?
JK: Once the playing field is a little bit more even when it comes to that online real estate, I think we’ll start taking market share back because their customer service sucks, at least down here. They’re lying to restaurants and they’re going to have to pay for it at some point. I literally have a team of people, four full-time people whose job it is to go around and educate restaurants and help them navigate their [Google] local knowledge panels and explain how to take their real estate back. It’s like my community service. I don’t even care if I get up on their local knowledge panel, but at a minimum, this is yours. Don’t let somebody take it from you.
Say what you will about the dude’s strong views on the delivery industry, which tends to be buttoned up—exactly the opposite of dude’s style. At the end of the day, at least it’s an ethos.