- DoorDash on Thursday confidentially issued a draft registration statement on Form S-1 with the Securities and Exchange Commission for an IPO of its common stock, according to a press release.
- Total shares and the price for the offering have yet to be determined.
- The IPO is expected once the SEC finishes its review process, subject to market and other conditions.
Rumors of DoorDash's IPO have swirled for over a year so this news comes at no surprise. But it also doesn't mean DoorDash will hit the stock market any time soon. Postmates, which initially submitted a confidential filing a year ago, has yet to issue a public offering and its CEO later said it was holding off until market conditions improve.
DoorDash’s initial offering could come up against increased scrutiny, especially with investors becoming critical of Grubhub's performance over the last few quarters even with the company maintaining profitability. Investors have also been scrutinized Uber Eats' performance, which isn't likely to become profitable until 2024, according to a Cowen report.
Despite potential investor reaction, DoorDash is well positioned for a debut on the public market. It became the top provider by monthly sales, surpassing Grubhub, and Morning Consult's Fastest growing Brands 2019 report named it the fastest growing brand in the U.S. DoorDash's total funding raised reached $2 billion with two-thirds of that funding raised in the last two years, according to Bloomberg. It reached a valuation of nearly $13 billion late last year.
While the food delivery industry has been long-criticized for one that isn't developing profits, DoorDash CEO Tony Xu told Fortune in February that a path to profitability has been in place from the beginning and that the company is working its way there. Once it becomes public, profitability will have to become a major focus to win over critical institutional investors.