Instacart the grocery delivery start up is testing and all new program for pick up only. Aaron, is this coming from a place of strength or weakness? I mean, it has to be a place of weakness you just called them a grocery delivery startup and they're getting rid of the delivery. Granted it's only a test, but InstaCart launched with so much promise you can get your groceries delivered to you at the touch of an app. This is entirely different. Picking up the groceries, that's a different business and I think that on top of InstaCart earlier last year scaling back some of its operations, kind of [ UNKNOWN ] down some of its growth plans. This is a bad sign for the company Well, look, I was among the people who thought that the whole idea of this company was a little bit crazy from the start because come on, how much money can there possibly be in grocery delivery? So I'm actually kind of heartened. I'm encouraged by this because They're finally realizing that there aren't in as quite as much money in those hills and frankly I think this move is kind of a higher margin area right? There you don't have to deal with the people and the goods and all of that and it allows them to tap into a new clientele. The suburban parent who's kid in tow just wants to drive by the store, pick up, move on. I think that makes sense but the problem here is that this means they're essentially a software company. They're giving up their whole value proposition, handing it over to the grocery stores. And that would have been a great Thing ten years ago maybe but I think that if you look at Walmart and Kroger they've become a lot more sophisticated. the big change, they're building their own software even Walmart and Kroger they're partnering with companies like Uba and Lift to do their own delivery. So mail really needs inster car .>> But why is wrong with being a software company? Every investor wants a tech company to be a software company and nothing else, right. That's where the margins are, that's where the scale is I mean, you said it, Uber, right? Look at Uber, Uber has made it possible so that you don't have to download a taxi commissions app. You can just use Uber across the country, across the world, right? Why can't Instacart do that with groceries. I mean, they can. The problem is, it's not that exciting of a business and they have competition from the actual grocers. Uber didn't have that. They're not competing against some dial a cab's local app. So they're Going into a tough market and it's a lot smaller than we initially thought. Instacars worth 2 billion dollars, they've raised $ 275, 000, 000 in funding. That to me doesn't sound like, I'm making a little out for grocery stores. That's like I'm disrupting groceries and so, to me, it feels like scaling back on some really big ambitions. All right. That's a fair point. For one show, that's always fresh. Come to fortune. com for more Tech Debate.

Instacart Is Testing a Pick-Up-Only Option

As it might be looking for new sources of revenue
