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An Interview With Collin Wallace
"Software is eating the world but that doesn’t mean it can’t have table manners"
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I wondered if I was being too harsh on customers while writing last week’s newsletter on delivery apps, but the delivery landscape changes so fast that you can be vindicated or proven wrong in a very short time. This week, the LA Times has reported on the increase in what is being called ‘dine and dash scams’, whereby orders are placed, food is sent, and then disputed by the customer ─ either as a fraudulent purchase, or as an incorrect order. The customer is taking advantage of those gaps between the app, the restaurant and the driver, that grey area where no one party has full responsibility, and exploiting it to get free food. The result is that the restaurant is left out of pocket for the sins of someone else. If you’re reading this in the UK and don’t think the same thing is going on here then think again. The LA Times article was sent to me by the GM of a restaurant in central London telling me he’s noticed this uncanny pattern ever since they switched to delivery.
I didn’t discuss any of this with today’s interviewee Collin Wallace, as we talked last week, but the themes and concerns are the same. Customer behaviour has changed and regulation is a slow train, so what can restaurants do to mitigate the pickle they find themselves in? Wallace may not be a name you know, but restaurants partially live in his world. As Head of Innovation for the US delivery app Grubhub, and before that, as the founder of FanGo, Wallace invented some of the restaurant facing technologies that the apps use today. I first came across Wallace as one of the smartest reply guys on another Substack post called Doordash and Pizza Arbitrage, where Wallace explained the economics of the apps in brutal, easy to understand terms. We kept up a correspondence and he was a crucial source in my own article on 1843 about the state of food delivery in the UK today. Each time I speak to him, I feel like something clandestine and impenetrable has suddenly been made clear.
The interview today, like all Vittles interviews, is paywalled, but please forward this on to anyone who works in restaurants. I am also going to open it up to anyone who works in restaurants if they send me a message, so if you know anyone who might want to read it, please send them my way.
An Interview with Collin Wallace, of ZeroStoreFront
I delved into your background with the apps for the 1843 article, but for those who haven’t read it, could you explain how you got started in the food delivery business?
Originally, I got into the space by accident. As you might remember I was a senior in college and I had a class that was really long, and you often didn’t have any food options. So I thought it would be cool to send a text message and have someone bring you food to your seat. And it turned out that wasn’t a great business for colleges because professors didn’t like it, but at the same time it turned out to be really interesting technology for stadiums and arenas. We started out in stadiums and arenas, where you could pull out your Blackberry and order food and have it delivered to your seat, and that was able to grow into a pretty meaningful mobile solution that we called FanGo software. Fans that go – I was still very young in my marketing acumen! We went down that route and over the years we had built a lot of solutions but it wasn’t clear that we were getting the value that we could do from them. Stadiums and arenas are really tough business for us – there’s this challenging theme that comes up again and again in this space, in that it’s not just about the value you create but how much of it can you actually capture and monetise. And if you’re not the most powerful one at the table, most times you only get what you have the power to negotiate.
What we found with stadiums is that we just didn’t have a lot of power – we were going against the NBA, the NFL, the unions and municipalities and the stadium owners, it’s hard to monetise that consistently. So we looked at hotels, airports, casinos and restaurants – same technology, you order through your phone and something is brought to you or waiting for you when you arrive. The original version was mainly applied to places which already had delivery infrastructure – the aim was to move electrons around, not atoms. That was the piece that was outsourced to restaurants or room service. That would change with DoorDash and, before that, with Uber. They were the first ones to provide delivery logistics as a crowdsourced service.
In 2011, one of the companies that we were looking at to licence our technology, along with Delta Airlines and Marriott Hotels, was the early Grubhub team. After Grubhub saw the pitch and saw the technology, they said ‘hey, look, we’d love to invest in you guys and we’d love to use it exclusively’. But because we already had so many partnerships, we said we can’t do it exclusively. So they came back with a term sheet and said ‘let’s do a tax-free merger and we’ll go after this space as a combined entity’. And that’s what we did. I became the ‘Head of Innovation’ for the company and my main job was thinking up new technologies for the business, most of them not to be applied immediately but looking forward about four to eight years. These were things like geofencing, when you get an automatic text when the delivery driver is nearby; syncing up with menus so you have accurate data, or you knew when a restaurant had run out of inventory. We built the technology that Grubhub branded as OrderHub, which is how a restaurant receives orders. If you remember in the old days, orders used to be received by fax machine! Or even a robocall. The technology that we built, which you’ll recognise today as tablets all over restaurants, that came from my team.
Quite soon after the merger you left Grubhub. What changed for you?
There was a realisation that happened for me, and I was fairly young in my career at this point (I was 25) – my thought was that when you merged two companies you get a happy mix out the other side. And that’s not what happens. Someone buys and someone is being bought. And when you’re being bought, and you’re the smaller entity at the table, your opinion becomes optional.
I didn’t set out to be a saviour for the restaurant industry, that was not a part of my expectation. But there was a weird inflection that happened. When you start working with restaurants, you get to know the type of people you’re talking about and where they come from and you hear their stories. I mean, I remember being in the seating area of one restaurant and literally babysitting a restaurant owner’s kids while they were filling orders just so I could talk to them and close them on using our technology. You could see they were anchors of their communities, or of their families. And then you dig a little deeper, at least in the States, and you find that one out of every three restaurant owners are first-generation immigrants and they employ one out of every five DACA recipients in the country. They’re people who not only look like me, in many cases, but share similar values. And so, it really changed our mission prior to the Grubhub days where we thought we had created a covenant: you’re going to help us build our business by facilitating this technology and, at the same time, we’re going to help you build yours, by getting you access to customs. After the Grubhub merger, we lost the ability to make sure that covenant was held true. I could no longer make sure my word was going to be carried out when I talked to restaurants and signed agreements. That for me was something I didn’t want to do; I didn’t want to be in a place where my ideas were used in a way that I had no control over or what the implications were going to be.
What was the thing that made you realise that some of what Grubhub was doing was not helping restaurants and that, in some cases, was actively hindering them?
The first realisation for me was about the technology we had created around the tablets, which was something we had created as FanGo, well before we even got to Grubhub. My thesis for it was ‘we’re going to put this piece of hardware into your kitchen and it’s going to let you receive orders from anyone that wants to send you orders’. Think of it like Visa. Visa is like the pipes – it works with dozens of banks and anyone can tie it into their unique following and still transact. My aim with this was not to own the restaurant, it was to facilitate them getting as many orders as they could get; you can make a lot of profit from charging a small tax the same way Visa does and that was going to be sustainable for everyone at the table. What I realised after the merger was that that was not the vision Grubhub had. The idea was to own the stack. The idea was to own the restaurant, to own every order that comes into it, to decide who can order from it and who can’t, who can deliver from it and who can’t. And that’s not always in the best interest of the restaurant.
The other thing is that in that space you’re being pushed to go public, to generate these massive growth curves and returns for your investors. That has to come from somewhere! Someone has to lose value, or lose market share in order for you to gain it. And in the restaurant space it’s not like other industries. Food is this thing that only grows at the rate of population growth, like 1-2% a year. That means if you want to push out a 30% growth curve on an annual basis, it has to come from somebody, you have to take it from somewhere. The easiest entity, the entity with the least amount of power at the table, is restaurants. You’ve got a husband and wife in a shop somewhere making their rules up against $40 million of cash – at least back then, now it’s $2-3 billion of cash. And with that you can say, ‘these are the new rules, follow them or you’re going to go out of business.’
In that relationship, again, you’re not getting what you deserve, just what you have the power to negotiate. And that ties into something we’ve previously discussed about what is ‘disruption’ vs what is ‘exploitation’. In my mind, disruption is when you have evenly matched components – like boxing in weight classes, where you can fight a guy who is similarly situated and let the best man win. It’s different when you have a guy who is 200lb beating up an 80lb guy. It’s not really fair, at least in the way I see the world. That is where the conflict has occurred for me, even today, where if you look at the large chains in the US and at the share they pay to the delivery platforms, it’s a fraction of what you pay if you’re a mom-and-pop shop. If you dig into the numbers what you find is that the small businesses are subsidising the larger ones and in the process being put out of business. It’s a losing proposition in many ways.
After leaving Grubhub you went to business school at Stanford and by coincidence you were in the class below Tony Xu and the rest of the DoorDash team, who were, at this point, called PaloAltoDelivery.com. And, if I remember correctly, you told them ‘look, I’ve worked in this space, I’ve worked at Grubhub, and they have the space sewn up’. And you advised them that it would be difficult for any new player to enter the market. Obviously, they ignored you and they’ve become wildly successful – the last stats I saw put them at holding more than 50% of the US market. What did DoorDash do differently that the others hadn’t cottoned onto yet?
Yeah, great question. Just a couple things: first, Tony and the team did an amazing job executing. I think Tony, and Stanley, Andy and Evan, they saw something that I didn’t see at that time, it was a miscalculation on my part in many ways. Or confirmation bias, where you’re going off things you’ve seen before and assume that things will stay that way. In particular, at that time the online ordering business for restaurants was about $10 billion a year. It wasn’t that big in the grand scheme of things. And Grubhub was coming up on 20% of that in terms of gross sales. It was a pretty dominant chunk of the pie – just as an example, Microsoft at its peak had about 60% penetration, so it was on its way to becoming dominant, or at least that’s what I thought.
I made an assumption that the business model only worked in really built-up areas like major metropolitan cities. And that was because the cost of delivery goes up exponentially with distance. If it’s 10 times further the delivery cost is 100 times more. For that reason, the suburbs hadn’t really been an option for us at Grubhub. I mean, we didn’t even provide delivery – we just provided orders and we thought the restaurants were well positioned to provide delivery themselves in the suburbs. That’s why you tend to get high margin food for delivery in the suburbs – pizza and Chinese takeaway – where you can still sell at a price including delivery costs that your customers are willing to absorb.
The thing that I miscalculated with DoorDash was, well, two things. The first was that the market was digitising at about 20% a year, which meant that every year about $2 billion of new spend was coming on. So even if DoorDash couldn’t fight Grubhub, they could build a really big business in the wake of this market expansion – in engineering speak it would be like cavitation, when fluid expands really quick it creates bubbles and you can build stuff in them. The second part was access to really cheap capital. In 2007, 2008 when the world went crazy, a lot of people took their chips off the table and put them in their pockets and said ‘it’s too risky for me to play’. And for a few years, they sat on their pockets and didn’t get much return. In 2012, 2013, everyone is rushing back to the casino to play. And there’s a lot of cash that had been sitting on the sidelines for a while, waiting for a home. What you saw were cheques being written and terms being offered to companies which you had just never seen before. I mean raising $2b, $3b, $5b, $9b prior to going public, this had just never happened. This was a totally new world opening up where you could operate your business in a net negative cash-flow state for an extended period of time, almost indefinitely, where you win by default because you’re the last man standing.
And actually, the third thing. I had some paradigms about how you could and couldn’t interface with restaurants. Like taking a restaurant’s menu and listing it without permission. Delivering without permission. Firstly, we didn’t think you actually could do that, that it would get you sued. But also, secondly, you didn’t have the power to execute it because you still needed the restaurant to deliver the food in the Grubhub model. In the DoorDash model you didn’t. You could just show up with a credit card, grab the food and you can work for me or not work for me: either way I’m getting this food. That was a very different model. In many ways, that changed the entire landscape.
I’ll just add one more point to this. If you look at the cost of expansion if you’re Grubhub, the biggest cost centre was the sales force, the people who would call up your restaurant and say ‘hey, how would you like to grow, we have this solution, let me send someone there to show you how it works’. You do inside sales, outside sales, phone sales, this was a huge cost centre. In the DoorDash model all you needed was a menu. You could just grab a menu, put it on your site and now, all of a sudden, you’re my partner. So the cost of expansion, of adding brands and restaurants, is now essentially zero. This is what let them build this trajectory which was just so fast, that even Grubhub couldn’t keep pace, and that’s why you see DoorDash so dominant.
Here in the UK the market is a little less developed but, in some sense, there are many similarities. There are three companies, two of which are essentially the same as in the US given Grubhub has been acquired by Just Eat Takeaway, and Uber Eats operates in both markets. And the third, DoorDash and Deliveroo, respectively, have been so successful that they’ve kind of become a metonym for the act of delivery itself. Like you get your food ‘DoorDashed’ or ‘Deliverooed’! It feels, for the time being, that this is the lay of the land in delivery. Do you think we’ve reached a state of competitive equilibrium in both markets or do you think the market is going to change suddenly again?
I think the US market is reconfiguring right now. I think maybe the better descriptor is that it’s bifurcating. There are two outcomes for restaurants, one for those who can adapt – they change their business models, their inputs as far as products, labour, marketing are concerned. And they exist in this world which is Grubhub, DoorDash, Deliveroo, from now on. There’s this other kind of restaurant which is not willing to change or adapt and, in some ways, they become like Xerox or Kodak, where they had the keys to the kingdom and squandered it. At the end of the day, no customers come to DoorDash for DoorDash. They come to gain access to some brand, some restaurant, a great sandwich or a great curry. Deliveroo is the same thing. In many ways, restaurants have given that up without a fight, to the platforms. Delivery itself is a commodity. No one cares who delivers your food! It’s just: does it get there on time? What’s the cost? Has anyone taken a bite out of my sandwich? Those are the things that drive you to one platform or another. But at the end of the day, you just want the food. Restaurants have given up their power.
But to answer your question as to what the future looks like, I’m seeing restaurants paying more attention to this. Restaurants are realising that their business is starting to look like an e-commerce business and that if it didn’t before Covid, it sure as hell does now. The skill set you need to be successful is very different now. It’s not, ‘can I lease high foot traffic real estate?’ or ‘do I know how to make an amazing product?’. Some of the time it boils down to ‘how well does my food photograph?’, right? ‘Do you understand how to build a following on Instagram?’. ‘Do you understand what type of people your customers are?’ ‘Who is your segment? Is it a health nut coming from the gym who wants something fast, quick and lean? Or someone who wants a 2am pizza and doesn’t care how healthy it is?’. The ecommerce sector understands this very well – you see this in Amazon, you see it in Shopify, where the whole ecosystem of tools has been set up to sell the same widget to 40 different types of people based on their segmentation. I think this is where restaurants are headed.
As it relates to delivery service providers, as I mentioned, delivery is a commodity. They have to find restaurants that they can differentiate themselves off. One of the easiest ways to do this is owning brands for themselves, which you’re already starting to see them doing. I think DoorDash just purchased a robotics company called Chowbotics, and it’s very clear they’re going to vertically integrate to produce their own products, in their own kitchens, delivered by their own people, to their own customers, and effectively cut out restaurants from the supply chain and capture 100% of the value across the chain.
Just to be clear, the robotics company, that’s to automise food production rather than delivery, right?
Yeah, a great way to think about it is a $10 sandwich produced by a restaurant. Chances are $3 of that is food, the raw ingredients. $3 is labour. $1 is what we call paper goods, like a fork, knife, box or a napkin. And the rest, the remaining 30%, is general and administrative expenses: rent, your accountant, your insurance, all that stuff has to come out of that 30%. What you’ve noticed with DoorDash and Deliveroo and the delivery service providers in general, is that they’re taking 30%! That means there’s nothing left, so how is this functioning? There was an assumption that this doesn’t work, that ultimately this is going to hit a wall and will stop. But what’s happening is that those other inputs are flexing. Those paper goods are going down, the food is being substituted for cheaper inputs. You’re going from labour that’s an employee to labour that’s a contractor, where you’re not paying unemployment benefits. You’re taking some of those tasks and giving them to robots. You’re changing how the recipes are put together to use less labour. Like putting together a sandwich - that is more labour than putting together a wrap. Creating a bowl, that’s even less labour than putting together that wrap. If you notice from browsing delivery platforms, you’re seeing these things morph into other forms. It’s not to make them more photographable, it’s about thinking ‘where can I shift these inputs to make room for delivery?’. Delivery is a hard input to change the cost of, especially as delivery areas continue to expand. It’s about where can I squeeze in labour, squeeze on inputs, as far as the food itself is concerned.
That’s fascinating, I never thought about the bowl being this new form being created and shaped by delivery but you’re right. To go back to what you’re saying about vertical integration and owning all the stacks: owning the robotics to make the food, owning dark kitchens, owning the delivery fleets and so on. Is that the next step for how one company or another is going to achieve domination, rather than the massive consolidation that we’ve seen up until this point?
Yeah, so hands down I think they’re going to vertically integrate. There’s no question in my mind. You will or you won’t exist. This is not new – funnily enough I’m reading this book called Titan, it’s the JD Rockefeller story, and Standard Oil was the exact same playbook. Commodore Vanderbilt – exact same playbook. JP Morgan – exact same playbook. Jeff Bezos – exact same playbook. It’s not new or a novel execution, but the speed at which it’s happening is, as well as the fact the government is moving slower than it ever has and business is moving faster. This inequality is hanging around for a lot longer – like with JP Morgan, the Sherman antitrust act came in pretty quickly. Or like ‘hey you can’t commandeer the whole of the oil in the US and charge the rates you want to charge’. In many ways, governments are infighting right now and not paying attention to what is happening.
But I think that’s going to change, ironically because of Covid. In many ways, Covid has highlighted, 1) the disparities between the haves and have-nots, and 2) the group of people who aren’t being cared for but who are providing labour. Everyone pays for the roads we’re driving on, for the people who educate us and, if you get sick with Covid, for the people who vaccinate you. But for food delivery, the people who are benefitting from your labour don’t pay your unemployment benefit, they don’t pay your healthcare, they don’t pay your social security. In the US, this is what’s going on with Proposition 22 and I think at some point the municipalities will say ‘hold on, the bills to take care of these workers is getting really big, and the people who are benefitting from this labour are not paying into this pool, but they’re all becoming billionaires off of these deliveries’. I think the government may try to help people there. Sorry... I think you were talking about vertical integration?
Yeah, and whether we’ve reached this state of equilibrium with these three companies and if we’re likely to see any more consolidation or if that’s it for the time being?
Yeah, that’s a good question. Hmm. I think most of the consolidation has happened. At this point, the players are more or less evenly situated in terms of access to capital and overall footprint. I think the other piece to remember is that when you consolidate too much, what you run the risk of doing is actually clearing a path for your competitors. This is the mistake that Grubhub made.
In the US, delivery used to be a very local thing – if you were in LA it would be Postmates or an early version of that, in the Bay Area it was Eat24, in Chicago it was Grubhub, in Atlanta it was Snapfinger. And what Grubhub did to companies in response to DoorDash is that it would simply go in and buy them. We bought all these brands and bolted them on to the Grubhub stack, but didn’t really do anything with them. What that meant is that when DoorDash entered these markets, there was no competition, because Grubhub had bought these competitors and were just sitting on them. DoorDash was able to take all of these markets uncontested because of consolidation, or poor consolidation. In many ways, I think the incumbents now may let some of these smaller players continue to exist in these markets – it’s almost like good bacteria vs bad! You let the good bacteria continue to replicate because it keeps the bad from coming in and taking a hold. And I think that might be the state of things for the foreseeable future.
Very interesting. You mentioned the government previously, and there’s been this heartening progress in the hearings on the Big Four tech monopolies last year. Here there’s about to be a ruling on Uber [note - this interview was conducted before the Uber ruling]. But on the other hand, there was Proposition 22, which many people in the UK may not have heard of or may not understand. Could you explain Prop 22 for those who don’t know about it and its implications?
In the US we have two major work classifications. One is a contractor, who we classify as a 10-99 employee, 10-99 worker. And the second class is a W2 worker, these are the forms that get filed with the IRS and the government. A contractor is someone who comes in and provides transient work for you; they are providing a specific job, like a plumber coming into your house, fixing your pipes and then going on to the next job. They are not your employee. The test for deciding whether or not a person is considered a worker or a contractor has to do with whether you have control over the services that they are providing, like when they come and when they leave, whether you exert control over the way they do their job. And if you have control over those things, then the government says, ‘well they’re an employee and you have to take care of them, and make sure they don’t work above a certain amount of hours, make sure they have a minimum wage, that they have healthcare or access to unemployment benefits, or sick days’. All those kinds of things. If they’re a contractor, then all those things are their responsibility. The difference is roughly about 30-40% in terms of wages – so if I’m paying a contractor $20 an hour to do some work, it’s going to cost me about $28 an hour to have an employee do that. That means, in many ways, getting a person to be classified as a contractor is a great way to save 40% of your labour costs. If you’ve got something that is very labour-intensive, like delivery, you’re going to save a lot of money from classifying them as a contractor rather than an employee.
Many of the platforms have been able to build their platforms in this grey area over who is an employee and who is a contractor. Eventually California, as a legislator, said ‘hey, this is not in the spirit of the law, even though it may be according to the letter of it’ and the spirit is, if you’re taking advantage of the labour to build your business then you need to pay your fair share, in the same way a restaurant should. California then passed a law saying this is not going to happen anymore and that, if the service that workers are providing is core to your business, if it’s essential to your business model, they’re your employee. That is now the standard and forget everything else. You can’t call someone a contractor if what they do IS your business.
So why did the vote go the other way?
In California we have this interesting system where they allow us to vote on these propositions and, in many cases, voters just aren’t informed about them. It’s hard because you’re expected to get educated quickly on this very complex or nuanced issue, like cannabis or prison reform, or, in this case, delivery. In many cases it comes down to who does the best job at marketing? And, in the cases of the delivery service providers, they had a captive audience. Any time you opened up the DoorDash app in California it would say ‘Vote against Prop 22! Make sure your drivers preserve their freedom and flexibility’. Same thing with Uber Eats and Grubhub. And they have tens of millions of users across the state.
You have that combined with really crafty legislation writing, so that it was kind of ambiguous on what you were voting for or against. And that was really interesting living in California, being abreast of the issue, because even when I read it, it wasn’t clear what I was voting for. It was written, I don’t remember the exact verbiage, but something like ‘Do you want to preserve the flexibility and rights of drivers… or not?’. And it was yes or no. And it’s like, yeah of course I do! But what they didn’t tell you is that preserving their flexibility means that they weren’t going to be treated as employees and get their benefits. And millions of people voted for it. I mean, I almost did. Being aware of the issue I almost voted the wrong way because of the way it was written. That’s a great example: $210 million was spent lobbying getting this pushed one way or the other, and 2 million drivers have ended up in this no-man’s-land, no-woman’s-land, as a result.
Other states have taken notice of this, and California is unique in that it lets people vote on these complex issues in the form of propositions. But in many other states it’s a senator or representative that’s voting for it. I think, in their case, they’re going to be much better informed about it and think, ‘wait a minute, this represents 5-10% of our employee base in the state and the people benefitting from their labour aren’t paying their benefits’. That is unsustainable. And I think there will be a headwind in other states.
Let’s assume that business keeps outflanking the government and that the regulation that the industry needs doesn’t come. What then do you think the solution needs to be? Does it require restaurants to be smarter about delivery? Does it require customers to change their behaviour? If regulation doesn’t come will the solution have to be more collective?
I would like to see a collective solution but I don’t think that’s really going to happen. The average person votes for their own interests – another way to think about Prop 22 is that although there’s more drivers than there are delivery service providers, there’s a whole load more people who like cheap delivery than there are drivers. It’s kind of like ‘I’d love for you to have healthcare… BUT I really love getting cheap burritos delivered’. That’s not going to go away. That means restaurants… I’m not going to say they’re on their own, but they need to take some responsibility for what happens to them going forward. These are things like working collectively together to get better rates, like bringing delivery back in-house.
Regarding our past conversations, the company I run now, ZeroStoreFront, builds tools to help restaurants capture their customer data so they can control how, when and where customers can interface with their brand. Whether it’s over the telephone, or their own website, or chat apps. Having the control to determine how customers interface with them – that’s the key. At the end of the day, it’s the customer who has the money. Not DoorDash, not Deliveroo, it’s the customer. And if you’re catering to their needs, if you’re providing what they want, the customer is just as happy to give it to you rather than anyone else. It’s your product that the customer wants anyway. What restaurants have done is sat back and said ‘oh you’ll do all of my customer discovery for me Deliveroo? Okay, great. You’ll manage my relationship with my customer? Great.’ And after a while, the delivery platforms just say ‘Okay this is no longer your customer, they’re my customer. And it will be 40% to have access to them – forever’.
There’s a lot that restaurants can do because you can get so many companies to deliver you food but how many great curries, or marquee sandwiches or burgers, are there in a given neighbourhood? That level of creativity and innovation that comes from being part of an immigrant community, or being part of a restaurant community, that is not something that you can write in zeros and ones, or replicate with software. That is the unique product, that is the non-commodity. They have to be a lot more deliberate about holding onto that insight and ingenuity rather than throwing it on every possible app and telling their customers ‘don’t interface with me directly, instead look at all these stickers in my window and order from any of them’. They have to be more deliberate because the nature of the business has changed.
Having said all that, if tech has been part of the problem then can tech also be part of the solution. Because the solution clearly isn’t to go back to the ’90s and eschew tech altogether right?
I think that’s right. We have a saying in our company that ‘software is eating the world’, which is not unique but, in our case, we add ‘but that doesn’t mean it can’t have table manners’. There are changes that are going to happen and be software-driven, but that can be empathetic to the underlying customer. This period right now is hard: restaurants have to change in a way they haven’t had to before. It’s difficult, there’s new skills, new technologies. Many of them, restaurant owners, are a little older. The heyday of restaurants was the 1970s, 1980s and a lot of those people are 60-70 years old now. I get it. We as a company understand that and a lot of other people do too. Our aim is to make the load lighter, but the lift still has to happen. The change has to happen or that business is not going to survive any more than the horseshoeing business did in the 1920s. You have the chance to switch from selling horseshoes to tyres for automobiles, but it’s a question about whether you want to have that challenge. And some don’t, they will say ‘this isn’t what I signed up for’. And that’s okay. But for the ones who are staying and the new entrants, they have to know that these are the new rules of engagement – you’ve got to own your customer, you need to understand the data, you need to know who you’re serving and you need to automate different parts of that process so you can do it at scale and do it cheaply. And that’s what we’re trying to do: to provide the tools to change what might feel like climbing a mountain to... maybe not an elevator, but an escalator at least.
Collin Wallace is the CEO of ZeroStoreFront and the former Head of Innovation at Grubhub. You can find him on Twitter at @enjoysjuice