DoorDash shares soar 78 per cent in stock market debut

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DoorDash shares soared 78% as the meal delivery service made its debut Wednesday on the New York Stock Exchange.

The shares opened at $182 after the San Francisco-based company priced them at $102 each late Tuesday. The opening price valued the company, which is trading under the symbol DASH, at around $58 billion.

DoorDash was born in 2013, when CEO Tony Xu and some classmates at Stanford University set up a website and posted local menus. After a few hours, they got their first order: pad thai with prawns and a side of spring rolls. The company's growth hasn't come without headaches. DoorDash has lost money in every year since its founding, citing the cost of developing its platform and expanding into new markets. Last year, it spent $410 million to acquire Caviar, an upscale rival.

DoorDash now controls 50% of the U.S. food delivery market. Its chief rival, Uber Eats, controls 26%, while GrubHub holds 16%. That's a change from 2018, when GrubHub was the market leader with 39% share and DoorDash held 17%. Several cities, including New York and Chicago, and the states of New Jersey and Washington have temporarily capped fees that delivery companies can charge restaurants. DoorDash says those caps force it to charge consumers more.

 

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