Postmates

Postmates Inc. is an American on-demand delivery company headquartered in San Francisco, California. It operates a logistics platform that connects consumers, merchants and a network of independent couriers ("Postmates") through a mobile app and website, delivering restaurant-prepared meals, groceries, alcohol and other retail goods. The company was founded on May 1, 2011 by Bastian Lehmann, Sean Plaice and Sam Street.

The business expanded from a handful of urban markets to broad U.S. coverage: it reported serving 30 cities in 2015, added 134 new U.S. cities in 2018 to reach 550, and as of February 2019 operated in 2,940 U.S. cities. Beyond consumer delivery fees, Postmates monetized through merchant placement and subscription-related products (Postmates Plus Unlimited) and by licensing its delivery API, which it opened to merchants in December 2014 so that smaller businesses could offer same-day delivery. It also pursued autonomous delivery, announcing a delivery rover in December 2018.

Uber acquired Postmates in December 2020 for US$2.65 billion in stock, and Postmates became an Uber subsidiary. In January 2021 the company laid off roughly 15 percent of staff (185 employees) and founder-CEO Bastian Lehmann announced his departure; the Postmates courier app and consumer service were subsequently merged into Uber Eats, with reports indicating Postmates would no longer operate separately after June 2021.

Founding story

Founder Bastian Lehmann dropped out of college and built an early flash-sale ecommerce site that failed after about a year. He later met co-founders Sam Street and Sean Plaice in Europe, and the team joined an early batch of the AngelPad accelerator with a content-curation startup called Curated.by. After investors, including angel Naval Ravikant, rejected that concept, the team pivoted to an idea Lehmann had carried since living in Europe—when he could not affordably ship a snowboard and found local courier quotes opaque—of using people already traveling as couriers. Ravikant led their angel round once Curated.by became Postmates. The initial app targeted merchants shipping bulky goods such as furniture and electronics, but users instead placed food and grocery orders, prompting the company to embrace an "anything from anywhere" model via a #GETITNOW campaign. Lehmann has recounted securing an early $250,000 check from the VC who had funded Uber after roughly six months of work on a prototype.

Business model

Postmates ran a three-sided marketplace linking consumers, merchants and independent couriers, taking orders through its app and website and fulfilling them via a crowdsourced courier fleet. Revenue came from consumer delivery fees, merchant commissions and paid placement (about 6,000 merchants paid for better app placement as of 2016), the Postmates Plus Unlimited subscription program that waived delivery charges in exchange for larger orders, and API integrations sold to corporate partners such as Apple and Starbucks. A 2020 lawsuit cited by Wikipedia alleged that delivery apps including Postmates charged restaurants fees ranging from 13% to 40% of revenue.

Delivery fees charged to consumers, merchant commissions and paid promotional placement within the app, subscription revenue from the Unlimited program, and fees from merchants integrating the Postmates delivery API. Reported revenue was approximately US$1 billion in 2018.

Traction

Reported roughly 14,000 couriers and approaching one million deliveries per month in late 2015, more than 1.5 million deliveries per month by October 2016, and about US$1 billion revenue in 2018 with 5,341 employees in 2019. Valuations rose from about $500 million (2015 reporting) to $600 million post-money (October 2016), $1.2 billion (September 2018) and $1.85 billion (January 2019); Uber acquired the company for $2.65 billion in December 2020.

Latest developments

Uber completed its acquisition of Postmates in December 2020 (reported closing December 1, 2020) for $2.65 billion in Uber stock. In January 2021 Postmates cut about 15 percent of staff (185 employees) and founder-CEO Bastian Lehmann announced his departure. Through 2021 the courier and consumer apps were consolidated into Uber Eats, with Postmates Fleet members required to reapply to Uber Eats; media reports cited by one source indicated Postmates would not operate separately after June 2021. The postmates.com site continues to present a consumer ordering interface for food, groceries and other goods.