LBS logo London experience. World impact.

Deliveroo: Delivering quality

What drives the winner of The Best Beats First Award?

By Julian Birkinshaw 22 November 2016

Deliveroo-Delivering-quality-974x296

Smart fast-food delivery service Deliveroo won The Best Beats First Award in the Deloitte Institute of Innovation and Entrepreneurship/Management Today Real Innovation Awards 2016.


As a Wall Street investment analyst chained to his desk in the noughties, Deliveroo founder William Shu received a $25-a-day dinner allowance which he splurged on takeout from New York’s famous food scene. He was transferred to Morgan Stanley’s London office in 2004 and went on to work for a hedge fund – but he still wanted great food delivered fast.

There were some players in the food-delivery game already but the quality of the food on offer was poor and customers had no idea how long it would take to arrive. That’s when Shu had his big idea – a delivery service so that smart restaurants could do takeout, too. The model is simple: Deliveroo takes a fee from both customers and the restaurants they order from, and gets you your food within 30 minutes.


He founded the company in February 2013 with Greg Orlowski, a former software developer, and spent the rest of that year criss-crossing London on a scooter to gain a deep understanding of the logistical network his venture would require. They started with three restaurants and Shu delivered some of the orders himself – often to friends who were still bankers. “They thought it was really comical but they kept ordering so that was cool.”


Now Deliveroo’s bikes are a familiar sight in 35 UK cities and 40 others internationally including Berlin, Singapore and Dubai – and Shu has 5000 people delivering food for him. Shu has raised a total of $475m – its latest $275 from Bridgepoint Capital said to take the firm’s valuation over the magic $1bn that brings entry to the ‘Unicorn’ club. It has just launched a corporate product and – surely the proof that it has really arrived – has prompted the launch of rival offerings from Uber and Amazon.


Deliveroo was by no means the first in its sector, but it has rapidly become one of the best. That’s thanks to its USP of providing a network of dedicated couriers and an ordering platform, making it easy for restaurants which wouldn’t otherwise offer delivery to do so. These include chains like Carluccio’s and Gourmet Burger Kitchen, as well as independents – even London’s Michelin-starred Trishna has signed up.


‘The idea itself is incredibly simple,’ Shu says. ‘We are successful because of our execution and technology. We’re agile and aggressive and these qualities will be essential as we scale up. We want to become the best food delivery service in the world.’ His advice for would-be entrepreneurs is to pursue one idea that you’re passionate about, believe in it against the odds and don’t hedge yourself in. “You have to go completely all-in. That’s the only way it can work.”


Julian Birkinshaw, Professor of Strategy and Entrepreneurship at London Business School and Academic Director, Deloitte Institute of Innovation and Entrepreneurship, adds: “There are no truly unique ideas out there. The idea of offering a service to bring hot food to people at home has been around for decades. But Will Shu at Deliveroo came up with a nice twist on the old formula, by linking up with existing restaurants and by emphasising speed of delivery.”

Comments (2)

Pablo Alegre 1 years, 8 months and 23 days ago

In Australia the business model cannot work if employment laws and employee rights are to be complied with. It appears to be a race to the bottom for employees if the business operators are in fact taking a 30 percent cut of the food price. It must surely be one of the more dangerous jobs in the country? No workers compensation is on offer in the event of a rider being injured. More at: smh.com.au/business/workplace-relations/deliveroo-and-foodora-accused-of-using-sham-contacts-for-bicycle-delivery-riders-20160329-gnsu7g.html

Pablo Alegre 1 years, 8 months and 23 days ago

In Australia the business model cannot work if employment laws and employee rights are to be complied with. It appears to be a race to the bottom for employees if the business operators are in fact taking a 30 percent cut of the food price. It must surely be one of the more dangerous jobs in the country? No workers compensation is on offer in the event of a rider being injured. More at:smh.com.au/business/workplace-relations/deliveroo-and-foodora-accused-of-using-sham-contacts-for-bicycle-delivery-riders-20160329-gnsu7g.html

IIE - landscape

Article provided by