Undercut competition by burning raised capital. Then once you've got the market share, you boil the frogs you gathered. I believe the euphemism around these parts is "disruption".

Unfortunately for them, you can go walk (or drive) and get a burger! I quite enjoy phoning through an order and picking it up like it’s 1986!

Near my old place, there's a poke place that simply refuses to take orders over the phone. They do do doordash, though.

New startup: we take your orders on the phone and order with doordash. For this we give you a 30% discount funded by VC.

With those enormous fees, how were they not profitable?

This is the reality of the astoundingly terrible business of food delivery. Take something with already razor thin margins, add multiple layers of middle men each with their own overhead and create the amazing situation where the product is incredibly expensive but most of the middle man take either low or no margins and the delivery person collects a rent but then loses that right away on vehicle maintenance and gas in many cases.

It's the biggest lose lose lose lose of all time. The only real winner is the government who collects tax on this net loss of a transaction.

This is also why direct delivery like a pizza shop or chinese place with its own delivery drivers works but the app delivery model doesn't.

Ya, agreed. The model is truly terrible. Too many constituents with a very limited pie

Sadly in some areas Uber eats and such have caused mom n pop delivery to disappear. There's a chain in Los Angeles, Lucifer's Pizza, which no longer offers delivery. If you call them up they tell you to use an app to order.

Papa John's in my area transparently subs delivery out to doordash now, and the experience is terrible. The drivers don't get tips (unless I happen to have cash, which I never do) and the pizzas arrive cold (presumably because they're trying to batch a lot of pizzas up in a single trip). I've given up on it.

And on top of all the fees the services expect you to tip their drivers.

I generally hate tipping culture but don't mind tipping. However with food delivery I'm LITERALLY paying more precisely for the delivery..