DoorDash has verified that it is raising “roughly $400 million” in a Series H round of funding.
Earlier today, Axios reported that the business was searching for a roughly $400 million round at a post-money evaluation of $16 billion. DoorDash clarified in a declaration provided to TechCrunch that the appraisal is somewhat under the $16 billion mark.
The round was expected, though the last evaluation of the deal can be found in $1 billion higher than earlier reports had indicated.
DoorDash, the popular American food delivery business, has strongly raised capital throughout its life, including a big Series G in late 2019 that valued it near $13 billion. According to the company, new investors Durable Capital Partners and Fidelity led the round, in addition to what it described as “existing investors, funds and accounts advised by T. Rowe Price Associates.”
That DoorDash raised more capital from personal investors is itself a quirk of 2020; the company privately submitted to go public previously this year, plans that were pushed back likely due to COVID-19, and the pandemic’s occurring financial discontent. However DoorDash is nothing if not capital-hungry, and raising an IPO-sized haul of money from personal investors is not just on-brand, however necessary, given the nature of the company’s business.
The domestic food-delivery giant is at war with Uber’s Uber Eats service, the Postmates delivery service and the Grubhub-Just Eat Takeaway hybrid. This extremely competitive market keeps capital requirements high.
It’s not precisely clear that DoorDash actually needed to take the money or hold off on a public listing. Other companies, like Vroom, were undeterred by what appeared like weak economics in their core organisations and made the jump to public markets. Perhaps DoorDash will go public quickly, also, this brand-new capital be damned. However if it does utilize its brand-new check to hold off on going public, the concern becomes what market conditions is DoorDash waiting for?