Given that so many of us are in the grip of
lockdown,
ordering food in rather than eating out, the news that food-delivery service
Deliveroo is cutting
staff
and scaling back was all the more surprising.
The London-based startup, which has operations in 13 countries, is axing
around 15 percent of its staff, blaming the public health emergency for putting
pressure on the business to reduce long-term costs. But, with healthy revenues
following expansion into new markets in 2018, the business is likely to weather
the COVID-19 storm.
The fast-food restaurants that fuel Deliveroo are expected to recover. In the
UK, the likes of
KFC
and
Nandos
are chomping at the bit to reopen as soon as possible, lockdown measures in
place or not.
The multiple-block queues of
cars
waiting for McDonald’s to reopen its drive-thru operations as lockdown
measures were eased in New Zealand show just how impatient we are for our
fast-food fix. Food companies that serve the general public were always going to
survive.
But what about businesses that serve a demographic that has completely
disappeared? US-based CaterCow is one of those
businesses. It operates in the same way as Deliveroo, Grubhub or
Seamless — but, rather than delivering food from restaurants to people’s
homes, it takes food from catering companies and delivers it to people working
in offices.
Set up by two of Airbnb’s first employees and a former investment banker in
2012, CaterCow has been growing steadily, with more than 2,500 customers across
eight cities — including New York, San Francisco, Austin and
Dallas. Last year, it celebrated its two millionth meal ordered, naming the
likes of Disney, Uber and Apple as key customers. Meanwhile, more
than 500 catering partners, including well-known restaurants and chefs, had
joined its roster.
The Coronavirus has since decimated the business. With offices closed and social
distancing rules in place, CaterCow’s revenues are down 98-99 percent.
A loan from the US Small Business Administration has given the business a
three-month stay of execution. And in the meantime, it has taken an interesting
pivot — not to chase new revenues, but to put people first in a time of crisis.
“We figured if we’re going out of business, we might as well die trying to make
a difference,” says Sean Li, the former investment banker among the
co-founders.
The result is CaterCow Cares, an initiative
that uses the company’s existing model to send food to hospitals, rather than
offices.
Image credit: CaterCow Cares/Facebook
By raising funds to deliver individually packaged meals to frontline
healthcare workers, it is giving local restaurants 100 percent of the proceeds.
At the time of writing, more than $67,000 has been raised, delivering 4,211
meals to hospitals across the US, and supporting more than 90 struggling
restaurants.
“These restaurants are our partners during normal times, so the goal is to keep
them alive as long as possible, so they can pay their staff and rent,” says Li,
who appears to be taking as much pride in CaterCow’s new reason-for-being as
what went before. “We’re not expanding to more cities to serve more hospitals
just to increase the numbers. We want to actually do a good job.”
The pandemic has forced many companies to consider their position, shift models,
transform products, invent new services and transform to stay alive.
-
EventProFinder was an app to
help freelancers find work. Now, it has rebranded as Intermission and
targets those that previously worked in the events sector, which has taken a
big hit.
-
Rosie on fire is a successful online
fashion brand. When sales came to a halt, it leveraged its Malaysian
supply chain to kick-start
SuperCleen — a brand for
Asian corporates that need protective gear, such as gloves and wipes.
-
Encore Music was a place for you to book musicians for events. Now, it
has pivoted to become an online
marketplace to buy recorded
musical messages, meaning musicians can still earn cash from home.
But CaterCow’s pivot is an altogether different proposition, and it was not an
easy decision to make. Classic startup philosophy is, you go where there’s
revenue — but in this case, there was none, Li says. While some of CaterCow’s
competitors have experimented with different revenue streams during the
lockdown, the business decided to take the opposite approach.
“Our whole angle for doing this is to help out the hospitals and our partners.
We wouldn’t be helping them if we took fees for ourselves,” he explained.
“Ultimately, we saw this as an opportunity to help the community, and we’re
grateful that people jived with our mission to help.”
Of course, nobody knows what life will be like once we come out the other side.
No doubt, office catering will still be a thing. But whether it rebounds to
pre-COVID-19 markets levels or not, Li has no regrets — and promises that the
philanthropic mission to donate food from local restaurants to those in need
will continue.
“Doing CaterCow Cares has been one of the most rewarding projects for me since
we founded the company,” Li says. “Hopefully, we will get some karma points from
this, and we make it.
“If things don’t pick up again by the summer, I will have to look for more
fundraising to keep our business afloat. But if we do make it out, it’s time to
celebrate by getting some ice cream and to think about how to rebuild our
business and keep on innovating to adapt to the new normal.”
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Content creator extraordinaire.
Tom is founder of storytelling strategy firm Narrative Matters — which helps organizations develop content that truly engages audiences around issues of global social, environmental and economic importance. He also provides strategic editorial insight and support to help organisations – from large corporates, to NGOs – build content strategies that focus on editorial that is accessible, shareable, intelligent and conversation-driving.
Published Apr 30, 2020 8am EDT / 5am PDT / 1pm BST / 2pm CEST