Being a food delivery startup is getting harder—investors are increasingly skeptical about the economics, Uber and its piles of cash have entered the market, and major labor challenges like worker classification and retention still linger.
To differentiate itself and possibly increase its chance to survive, San Francisco-based DoorDash is rolling out a new ratings system for restaurants it delivers from, based on aggregated customer feedback. Each restaurant gets a score out of 10, and DoorDash's app and website display them in order of their ratings. Its app and website also got a redesign to go with the new feature.
"The idea of the 'Delight Score' is to help consumers discover restaurants [in the area] that they may not know otherwise," DoorDash co-founder and CEO Tony Xu told Fortune in a phone interview.
He added that because the score looks at criteria like how well the food travels and how quickly it's prepared, DoorDash is the only service to evaluate restaurants in the context of food delivery.
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Founded in 2013, DoorDash provides delivery for restaurants and eateries. It got its start in the Bay Area, and has since expanded to a total of 23 markets, including New York, Seattle, and Chicago. Like competitors Postmates and UberEats, among others, it provides a sleek mobile app and website for customers to browse and order, and handles the delivery by employing its own drivers—as contract workers, of course. To make money, it charges a delivery fee to customers, as well as a commission fee to restaurants.
To be fair, DoorDash's rating system isn't exactly revolutionary. The ratings are an aggregation of users' feedback, just like those on Yelp or Google, instead of personalized recommendations from each user, and the company said it doesn't have any plans to for the latter at the moment. Admittedly, personalized recommendations are hard to do well, but they would be quite useful to customers.
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But on the other hand, it could become a valuable tool to keep DoorDash's customers coming back for more. It could ensure that only the best restaurant show up at the top when users go to order and, in theory, also ensure they're happy with their meal and experience every time.
And with the growing competition, every little bit helps.
DoorDash also revealed earlier this week that it closed $127 million in new funding, after months of speculation. According to Fortune's Dan Primack, this brings DoorDash's valuation to $717 million, far from the $1 billion mark the company was reportedly seeking. What's more, that funding round was likely a down round—when funding is raised at a valuation lower than the previous one—according to Fortune, further highlighting the cooling of the investing climate in the tech industry.