It doesn't work great in house. It works great with economies of scale. I don't know the history of pizza delivery, so this is speculation, but I imagine that pizzas travel well, and people became accustomed to ordering them for delivery. So a driver can load up on pizzas, make a whole bunch of deliveries (and people are generally satisfied with the quality), rinse, and repeat. That's economical. Delivering a handful of orders at a time (maybe even 1) is obviously a terrible value proposition. But if it's incremental revenue, and covers your cost of goods sold, you may as well let Uber lose money to do it.