GrubHub's website.
Courtesy of GrubHub

The company posted its latest quarterly earnings on Tuesday.

By Kia Kokalitcheva
May 4, 2016

GrubHub is long past the hot young startup phase of getting headlines for merely delivering burritos and sushi to hungry customers. But CEO Matt Maloney isn’t worried, and in fact, he’s glad.

After posting mixed results for the year’s first quarter (revenue is up, profits are down), Maloney dismissed the threats from newcomers in the food delivery market like Uber, Postmates, DoorDash, and even Amazon’s new delivery service for restaurants.

“Uber and Amazon are the new boogeymen in the market,” Maloney said during GrubHub’s quarterly earnings call on Tuesday. “I think last year there was more concern around venture-backed startups that ended up not being quite as competitive as people were worried they would be,” he added.

For many years, GrubHub, which Maloney co-founded with Mike Evans in 2004, focused on simply providing a website where customers could browse and order from local restaurants that deliver. For a while, this proved to be a great business, and GrubHub eventually went public after merging with another popular service, Seamless.

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Then in early 2015, GrubHub took the plunge and began to offer its own delivery service for restaurants that don’t do it themselves, a move directly competing with those startups Maloney says he’s not bothered by. Though some of these companies like Uber and Amazon have large operations and bank accounts, Maloney says they’re far from experts in getting meals to people’s doorsteps.

“Uber gets crushed in the App Store,” he said in an interview with Fortune about Uber’s new food delivery-focused app, UberEats, which he claims is failing to get great reviews from users. “Right now, you’re hearing Uber say ‘We’re going to get it to you in half an hour’—that’s bullcrap.”

Maloney also took a shot at Amazon, which recently expanded its food delivery service for Prime members to San Francisco, its eighth city, by claiming that the e-commerce giant doesn’t have a competitive advantage. Sure, Amazon amzn has mastered logistics when it comes to shipping and even short-order delivery, but food is another ball game. Just because it built a service, it doesn’t mean it will be able to convince its customers to use it.

And that’s a big problem, according to Maloney. “The logistics business is crummy, it has bad margins,” he said, adding that “the only thing that matters here is volume of orders.” While GrubHub incurs much of the same expenses as all other delivery services, like paying drivers, Maloney touts GrubHub’s market share.

“Because we have the volume, we don’t have to fake it ’til we make it like the venture guys,” he said. GrubHub’s delivery now rakes in $250 million in gross food sales on an annualized run rate, still only a fraction of GrubHub’s overall gross food sales. In 2015, its gross food sales totaled $2.4 billion, and in the first quarter of 2016, they topped $712.8 million.

GrubHub grub makes money by taking a commission fee from each order made through its service and charging a small delivery fee. The size of the commission is set by each restaurant and determines how high in search results the restaurant will show up. The higher the fee, the higher up the results.

Some companies haven’t been as lucky with their business models. Meal delivery startup SpoonRocket, for example, nearly shut down before Brazilian company iFood acquired it in March. But overall, investors have grown weary of the financial sustainability of delivery services.

Even GrubHub’s stock price has taken a hit over the past year thanks to a couple of disappointing quarterly earnings and investor concerns over the rise of competing services like Uber.

Unlike his competitors, Maloney has not desire to start delivering flowers, pants, or iPhone chargers to customers, calling it a trap that would only distract his company. “There is so much opportunity just in food delivery, just here, that I could do this for 20 year and not tap out the market,” he said.

Some of his competitors, like Postmates, have touted a strategy that heavily leans on delivering a wide variety of items in an attempt to spread out the demand for their drivers during the day. The idea is that while food is concentrated around meal times, online shopping, for example often happens in the afternoon.

“I think there’s a lot of misinformation right now, and that’s because a lot of these groups need to raise their next round,” Maloney said about upstart rivals and their quest for investment money.

Still, delivery is expensive, and Maloney says he’s happy operating that side of his business on a break-even basis. “It’s a nightmare—go talk to anyone in the on-demand space,” he said of operating a delivery service.

“You have to recruit people, you have to train them, you have to get them on a schedule. And by the way, you have to do it without telling them what to do because of the legal implications,” he added, hinting at the wave of lawsuits delivery companies, his included, have faced over their use of contractors instead of employees.

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