A startup called Wonder is the new owner of Grubhub. The food delivery app announced acceptance of the deal on its website earlier today.
Wonder acquired Grubhub from Dutch food company Just Eat Takeaway for $650 million. The deal is expected to close early next year, pending regulatory approval. Wonder also announced that it has raised an additional $250 million in venture capital funding “to further our mission and growth.”
Chicago software engineers Matt Maloney and Mike Evens founded Grubhub in 2004 as an online restaurant ordering service and an alternative to paper menus sent to doorsteps or in unsolicited mail. The company merged with automated food ordering and delivery company Seamless in 2013. Just Eat Takeaway acquired Grubhub for $7.3 billion in 2020 at the height of the COVID-19 pandemic.
As the pandemic became part of history and people started going out again, the number of restaurant delivery apps started to decline. The legal troubles began in 2021, when the city of Chicago sued Grubhub and some of its competitors for alleged unfair business practices and fees. While DoorDash and other companies eventually settled, Grubhub’s legal battle with Chicago continues to rage in court, according to the Chicago Business Journal.
The District of Columbia won a similar lawsuit against Grubhub in 2021, which ended in a $3.5 million settlement. The following year, Grubhub announced it would lay off 15 percent of its internal staff.
Wonder is a new food delivery company started by Marc Rohr, a former Walmart executive who owns two professional basketball teams. Mr. Lowe previously founded Diapers.com and Jet.com. The New York Times profiled Lore and his latest venture, Wonder, which he said “could become the Amazon of food and beverages.”
Wonder’s initial focus was to create a delivery service that would allow people to “start and run their own restaurants” and offer services that were “cheaper and faster to assemble.” According to CNBC, that’s probably because the prices of third-party food delivery services like Grubhub, DoorDash, and Uber have skyrocketed in recent years.
In New York City alone, food delivery prices have increased 58% in less than a year, according to Bloomberg. A new law that went into effect late last year raised the minimum wage for delivery drivers in New York to $17.96 an hour. In just eight months, food delivery workers’ wages have increased by 64 percent and tips have decreased by 60 percent, according to a report from the New York City Department of Consumer and Worker Protection.
