DoorDash, Inc. (DASH) Earnings Call Transcript & Summary

Good afternoon, and welcome back to the afternoon session here of the Deutsche Bank Media, Internet & Telco Conference. This is Lloyd Walmsley on behalf of the Internet Research team. We are excited to have Andy Hargreaves, VP of Investor Relations from DoorDash, join us. Andy, thanks a lot for being here.

Yes. Thanks for having me.

Great. Well, so I've got a bunch of questions that we can go through and then encourage everybody on the line to go ahead and post questions into the portal, and we will try to either integrate them as we touch on different topics or just ask them outright. I will kick it off, Andy, with just a broad question. DoorDash is best known for restaurant delivery, but you're increasingly doing a lot more across convenience, grocery and other last mile. Talk at a high level about what you guys are building here.

Yes. So the founding vision, right, Tony, Andy and Stanley's founding vision was it was never to build the biggest restaurant marketplace in the U.S., right? That was a component of it, I suppose. But what the original vision was and still is the vision today is to build a platform to support omnichannel, local commerce of all kinds, and we are trying to do that both through our marketplace, which you could call sort of the full-service offering. And we're trying to do it through our platform services business. Currently, the platform services business has 2 offerings, Drive and Storefront. But certainly, over time, we would look to add quite a few more services and add more verticals to both the marketplace and platform services.

So I guess diving into the core food delivery business, walk us through a bit how you all started from behind to really become the largest player in the U.S. here. What did you do differently strategically, operationally, to really set your business apart?

Yes. I think -- and you sort of stratified it in a good way. I think there's a couple of different layers to it. I think at a strategic level, there are probably 2 big unlocks. And one was recognizing that this business did actually work in the suburbs and that people in the suburbs like food being delivered to them just as much as people in the cities. They just didn't have it before. So recognizing that there was both demand and unit economics that worked in less dense areas was clearly important. The other was recognizing fairly early the value of supply. In other words, when you add more restaurants to the platform, you get more orders, and it's a better experience for the consumer. And we're quite granular about that and have formulas built around it based on the kind of restaurants that you're adding. And I think that dictated a strategy to go quite aggressively after expanding supply. And we were effective at executing against that, and that helped create a better overall experience. At a more operational level, I think there was a couple of things. And one is we spent a lot of time early on working on merchant integrations. Part of this stems from the founding mindset. And it's more of sort of a merchant-first merchant services kind of mindset where we got in and tried to figure out what the problems they were seeing as they were trying to add delivery were and solved those problems. And that meant spending a lot of engineering resources on POS integrations and kitchen systems integrations and all these things. And what that does for you is it gives you a lot better -- it's does 2 things, really: but one, it gives you better informational feedback, which helps inform the logistics network and create better efficiencies. The other is it helps you reduce manual errors. And errors in the business are quite expensive, both in the direct sense and in the indirect sense that you end up with an unhappy consumer that might not order in your platform anymore. And when you look at that level of work that we were doing and just trying to get a little bit better every single day, what you ended up with was a platform that was just a little bit better of a quality experience. And you had more supply, it got to you a little bit more consistently. And those things led to better retention. And then better retention helped fuel the growth because mathematically, you grow your user base faster. And then it also -- when you have good unit economics, drives higher LTVs and then that feeds your customer acquisition spend and you can sort of afford to spend more and more as that base grows. And so I think the -- there's a ton behind that, that was happening on a day-to-day basis, but that was sort of the big picture.

Okay. So on the 4Q call, and again, you kind of mentioned the restaurant supply and there is more work to do. I think you've got the largest supply footprint in the U.S. right now. So where else are you investing on the core restaurant supply side for food delivery?

Yes. So we're still trying to add significantly. We think people have different estimates. Our estimate is there's roughly 1 million restaurants in the U.S. and so we still have quite a bit of room to go on that front. As we get into new categories, that obviously adds entirely new elements of supply that we need to build out to build density and make the service available to more people and more consistent. And everybody likes different brands and so there's elements of that, that need to get filled in as well. The other piece of selection is it's not just a raw count that matters, right? It's what each individual sees sitting in wherever they are. And that, to a certain extent, becomes -- I mean, you have to have restaurants on the platform but it's also a delivery efficiency question. And can you expand your delivery radiuses around restaurants to offer effective supply that's higher on the individual level than what others are able to provide? And yes, I mean, we're still trying to work quite hard at that and hammer out inefficiencies in the system that we can pass along to consumers and either faster delivery times or bigger radiuses and certainly think that there's still a lot of room to go on than just raw supply.

So talking about DashPass. You guys have -- we think it's over 6 million subs. I think the disclosure is over 5 million. Tell us a bit about what makes this a win-win-win for you and customers and restaurants in terms of loyalty, frequency, et cetera.

Yes. So the last disclosure was 5 million-plus as of September of last year, and we didn't give an update other than to say that, yes, it has grown since then. The dynamics of DashPass are fairly straightforward, right? You get a lower incremental cost to the consumer. You sign up for the subscription, your delivery fee goes away. Your service fee, roughly speaking, gets cut in half as long as you're ordering from DashPass-enabled merchants. When you have lower fees, you get more ordering. And so that's a good experience for the consumer. And your breakeven on the consumer side is roughly 2 orders a month, which you can do quite easily and a lot of people do. On the merchant side, and this is true for the dashers as well, you get more volume and more volume means sort of more earnings opportunities for Dashers, more revenue, throughput, more gross profit throughput for the store. And for us, we get high-frequency consumers that are a little stickier to the platform. We get consumers that tend to be, I'll say, like a little bit more resilient, meaning they understand that we make mistakes sometimes and they're a little bit more accepting of that. And we get opportunities, I think, with those customers to try new things. Because they're high-frequency customers, they're a little bit more willing to try new categories or different aspects of the app. And so they're a great way for us to see, is there product market fit in new things that we're trying out? So it took a long time to get the economic model so that there was good alignment on all sides so that more volume is good for everybody. But we think we've got a good model now, and obviously, we're quite happy with how it's gone.

And how do you guys look to grow this business? Is it literally just kind of informing consumers that they'd save money with DashPass? Is it more partnerships like the Chase deal? What are some of the ways you guys are looking to expand this?

Well, we're looking to expand it in every way we possibly can. I think right now, a big part of the value proposition certainly is savings on -- if you're a decent volume customer, you're going to save money. We're trying to expand that though, for sure. I think we have a broader view of what DashPass is capable of over time, and we want to bring new features to it, unique aspects to DashPass that aren't available to the broader user base that people actually like and find value in, right? And whether that's pickup benefits or unique items or even whatever you can think of down the line, we're trying to think smartly about all that. I think when you look at the Chase deal, that's been a fantastic partnership for us. We very much like that deal and the various components of it because there are several components. That is -- has been a good customer acquisition tool. I think there's maybe a misperception about how meaningful it is to the user base at this point. Is this not a significant portion? I mean, it's meaningful but it's nothing close to a majority or anything like that. The vast majority of our consumers or DashPass subscribers are organically acquired. But the elements of that deal have worked out great. And if there are other deals in the future that we saw that were similar and were beneficial for both parties, like, yes, obviously, we would love to do those.

Okay. You touched a little bit on it but how do we think about the product evolving on DashPass? Is it -- are you thinking -- would you eventually integrate Drive potentially or add other new products into the subscription?

Well, Drive probably not because that Drive volume is coming through other parties, right? And so it's possible that you could do a deal like that. But typically, right, your Drive user is doing Drive because they want to own the consumer relationship, and so they might not want to share that with us. If they were, I'm sure we would be happy to at least explore that. I think without giving away the road map, right, there is a lot of elements to, right now, food. and in the future, sort of all of local commerce, where I think we can provide benefits. It's not such an element right now but our consumers are major customers and big fans of a lot of the brands that are on our platform and that we would hope to add on our platform over time. There is a community element, I think, to people's shopping behavior. And we would want to reinforce that in whatever way we can, and we would hope to integrate some of those elements into DashPass, which you see a little bit already, right? You get pick up benefits on DashPass and pick up is a good thing for the restaurants. It's a nice way for us to sort of be able to offer a different experience to consumers. And you could -- I don't know, use your imagination, I guess, to figure out other things that we might do along those lines.

So as things reopen, what can you share with us about some of the markets that have reopened more than others in terms of order frequency, AOV, overall bookings? What have you guys seen there?

Yes. You obviously get this question a lot. And I'd start with a caveat that I don't think that anything we've seen will be a perfect analogy for what we will see. We've seen quite a bit of different sort of behavioral responses as markets have opened up on sort of the extreme end, you saw Melbourne, which was basically completely closed and then completely open, and I think they've sort of had their outbreaks. I'm not sure exactly where they are now but they're not completely open anymore. But anyway, when they went from closed to open, you saw volume on our platform down 20%. And we're not as meaningful of a player there. DashPass is barely a thing there for us. So there's some reasons to think that maybe the U.S. would be more resilient, but that is one potential outcome. In the U.S., last year, we had a number of markets that were quite open, I guess you could say, in the summertime. And we were actually quite pleased with the behavior that we saw on the platform in those places. And particularly with higher-frequency consumers, you really saw very little change in sort of the ordering trends. You did see some impact to total volume. It was mostly tied to very recently acquired and low-frequency consumers, which suggests that there is some habituation. The challenge with that is, one, their government check's being handed out. There's not a lot of travel that was going on. And so you had, I'll say, excess disposable income that was being reallocated. And that probably won't be a permanent thing. You've also had different starting points, right? Florida was quite open but it was never as closed as some other states. And so the disruption to the trend, in other words, from the reopening process wasn't what it was likely to be in other places. And so all that is to say, there's a lot of uncertainty still, and we don't know exactly how it's going to play out. And so what we're going to do is the same as what we always do, which is just focus on getting better every day. And I think what we're comfortable with is the long-term consumer demand for convenience is not going to go down. And so if we can keep making the product better, more supply, more consistent, cheaper, ideally, we can continue to expand the market and grow.

So on 4Q, the order contribution was a little lower than we expected, and you all guided take rates to be a little lower in 1Q. Walk us through some of the moving parts here. And then, specifically, I know part of these were price caps. Why do you think a lot of cities didn't actually have this up and running sooner? Surprised that it took so long for some of those price caps to come into effect. And kind of how do you see those playing out as we get closer to the end of the pandemic?

Yes. I think in a lot of cases, quite honestly, I'm not sure people realize they had this power in sort of the unique nature of this emergency status that we're operating under sort of expanded powers, the political powers at the local level and gave people an expanded purview of what they were capable of. And I think it took a little while for them to catch on. Just like anything, it takes a little while to catch on, right, because you have to see other people do it. And then people go, oh, wow, I didn't know I can realize that or I didn't realize I can do that. And then in Q4, a lot of people realized they could do it and they expanded quite rapidly. I guess I'm with you that they -- I'm a little surprised they didn't catch on earlier. I'm also a little surprised they haven't spread to other areas, quite frankly. But whatever, that aside, yes, that was new, at least the scale of it was new in Q4. And had we talked about it, was a negative $36 million impact, which hits revenue and flows basically cleanly through. Those have, on a gross basis, continued to increase but we're basically managing it to a negative -- roughly the same $35-ish million impact from here on out. And all of them are tied to emergency status or dine-in rates. So hopefully, as markets reopen, those start to fall away. But for guidance purposes, we've assumed that, that's sort of flat $35 million. The other piece is obviously Prop 22, and that is a very, very significant cost that we are choosing to absorb a healthy amount of. And the reason we're doing that is to strategically favor DashPass primarily. Anytime you have an incremental cost in the system, if you're the scaled player and you have efficient operations, you can absorb costs maybe more efficiently than others. And in our case, we want to use that to provide a bigger pricing umbrella for DashPass, to provide more value, basically, to DashPass subscribers. And so that's a big impact then to take rate. And again, that flows basically smoothly through the P&L that will be a full hit in Q1, and then we should be able to sort of be rebased at least along that cost from there.

And on the price caps, how -- are you comfortable those will go away? What needs to happen? Are there certain things that need to happen like emergency orders lift for those to go away? Do you see risk that some of those last longer? Walk us through some of that.

Yes. I mean, I think we're as comfortable as you can be when you're dealing with anything that has a political element to it. They are, all of them at this point, written with specific terminations and they're either end of emergency status or dine-in rates getting to a certain threshold and the threshold is different in different places. But -- and then there's usually a little buffer period. So dine-in gets back to whatever the threshold number is, 50% or 70% and then there's 30, 60 days, something and then the cap falls off. So as it's written as long as we recover from COVID, which hopefully we do sooner rather than later, the caps will come off. There has been some push to make them permanent. We have seen though in some cases, right, local Attorney General in one jurisdiction, just flat out said, "You can't do this. It's unconstitutional." I think that view is actually fairly pervasive, at least amongst the people that we talk to. And so in the sort of regulatory risks that we think about, that is not one that we're awfully concerned about.

We've heard from a couple of QSRs that the stimulus really benefited trends in December and January for their sales growth. What do you guys see as the impact of stimulus on the business? And how do you think about this if we get this latest stimulus bill fully through Congress and signed impacting the business?

Yes. So what we've seen with the last couple of rounds is there is a benefit to the top line. Sort of the disposable income point I was making earlier, you do get incremental cash in the system and that gets spent and it gets spent on eating in your house. It's mitigated in our business a little bit because there's also an impact to Dasher availability and Dasher supply. And there's good and bad in that. That is it sort of offsets the profitability impact of that incremental volume. The good is it's one more data point to add to what's becoming a fairly long list of how people use Dash. And what I mean by that is there is an assumption in a lot of the worker classification efforts that these are people that want full-time jobs and they're using it as a full-time job. and so we should make them full-time employees. And what this behavior shows is no, that isn't. What this is, is a flexible way for people to earn incremental cash. And the flexibility is the key because they're typically students or work in other places or they have family commitments or whatever it is. And so when they get cash from another source like a government check, they don't need to do -- they don't need to Dash as much. But when they don't, we provide them that sort of flexible earnings opportunity. And I think there's a lot of work we still have to do to sort of make that better known. But that's something we're trying to do and hopefully, we're effective at it.

On the earnings call, you talked about Prop 22 costs absorbing most of those. Is there any sign that, that is benefiting you in terms of market share or order frequency to absorb most of those costs? Or is this a sort of thing that's still in a testing mode?

Well, I don't know that I should comment on anything happening necessarily in the quarter and basically, all of the Prop 22 impacts that are measurable or are in the quarter since it started so late in Q4. I think maybe a different way to answer the question is, look, if we were not seeing the results that we hoped for, certainly, we reserve the right to change, right? And like in all of these cases, whether it's commission caps or Prop 22 or just selectively raising Dasher earnings or lowering merchant commissions or whatever it is, you always have the option to sort of pass on incremental cost to the consumer. We're trying really hard not to do that though because especially with DashPass, the entire value proposition or a lot of the value proposition is tied to lower fees, so it's sort of antithetical to go and raise costs on them. The bigger piece is just like we think the cost is still too high and that, that's an impediment to long-term growth. And so we just want to be sort of philosophically hammering out costs from the system and being able to pass that along to our different stakeholders to make the whole system more liquid, less friction and more scalable.

So Andy, where are you guys in that cost equation and the density side? You've talked a lot, particularly around the IPO, about getting big jumps in Dasher efficiency. Do you get to certain points where you've got enough density and those benefits start to kind of asymptote? Or are you still seeing big efficiency unlocks in the business?

Yes. So I wouldn't -- I don't know that we are seeing big, like stair-step changes, and that just hasn't been how it's worked historically. What we see is very steady improvement. And there's -- at least with the delivery network, there's, I guess, 2 big ways that you can create efficiency, and the efficiency that you're talking about is basically our cost per order, right? And one is by batching and that's something that gets a lot of attention. The other and the one that, quite honestly, we've focused a lot more on historically is by eliminating waste. And you go through the different steps of a delivery and there are minutes and seconds to waste in almost every step, if you want. And eliminating those, especially when it's scaled over the type of volume that we do can save a lot of money that then you can either reinvest in the business or pass along in terms of savings or raise Dasher pay or lower merchant commissions. And we still think that there's quite a bit of those to be had. We have gotten quite a bit more efficient but there's still a lot of places where there's minutes or seconds that are wasted, there's orders that are done incorrectly because of whatever system errors or there is no system, there's still too many tablets out there. And all those things are things that, as you can imagine, we're trying to work on, on a day-by-day basis, and we're measuring the multiple decimal points and trying to get a little bit better every day. 1% better every day is sort of the internal statement. On batching, there's a trade-off. And when you do have these sort of unlocks on efficiency, you can do a few things with it. You could batch more. You can extend your delivery radii around the restaurants or you can lower your delivery times and/or get more consistent with your delivery times. Historically and still today, we've tried to focus much more on delivery radius and delivery time because those have very tangible sort of positive impacts on the consumer experience. And then batching basically becomes an output where as you get more and more volume on the system, in some cases, it's around very specific restaurants or very specific neighborhoods, but as you get more volume, you have more natural opportunities to batch that emerge. Two people randomly that live next to each other, ordering from the same restaurants or restaurants that are very close to each other at the same time, that kind of thing. And so yes, the batching rates have gone up but it's always been an output. It's not been something we sort of target to increase. It might become something we target over time. I think, in particular, as you get into more verticals and you have more opportunities to promote bundling inside of the app, that could be something that we push more aggressively, but at least to date, it hasn't. And it's not necessarily on the road map. We still think we've got a lot of room to eliminate waste first.

Can you talk about, I guess, the broader regulatory environment? I know that around the IPO, you all talked about an expectation that there might be more states following suit to what we saw in California. Any real update from any key states on regulation or legislation similar to what we've seen out of California?

Nothing super meaningful, I think. Maybe taking a step back, I think it is important to contextualize this. I mean, this is a sort of a democratic issue. And so we really see 0 interest in this basically in Republican states. We really don't see much interest even in sort of your purple states. And I don't know, my policy people might cringe, but my sense is the momentum around it has actually slowed a little bit because of, one, like Dashers do very consistently say, in fairly significant majority, we don't want this. The other is Prop 22 did not pass by a small margin. It was quite a large margin, almost 20 points in what could be considered the bluest state in the country. And I think honestly, that has gotten some people's attention. Now we still see efforts in other states, and we are in ongoing conversations in several of those. There's sort of a handful that still have this happening at some level. And we'll continue to work with the governments in those areas. We'll continue to work with the union leaders in those areas and just see kind of where it goes, try to craft legislation that protects the flexibility of Dashers, first and foremost, while still creating an environment that we can operate in.

How do you see the competitive environment right now? Anything we should be keeping our eye on from -- on this front?

Well, I haven't seen what I'd call significant changes. I think it's always a competitive market or it has been as long as I've been looking at it and it's still very competitive. Uber is no dummies and neither is Grub and all of us are ambitious. And so -- but that's basically been a constant. And we haven't seen tactics around that change too dramatically. There's obviously open questions of when Just Eat Takeaway completes the Grubhub acquisition, will that change how aggressive they are? Will the tactics change? We'll have to sort of wait and see on that. And same thing with Uber. When rideshare comes back and they have more profit running through the system, will they get more aggressive? I think -- will they get more aggressive around bundling as well? I think we'll watch all those things quite closely, obviously. And I think where we feel good about our position is we do have a product that retains quite well. And we have unit economics that we think are leading in the space in logistics And those give us very good LTVs. And when you have good LTVs, you're in a good position to sort of fight customer acquisition battle. So we're ready, I guess, if people want to get more aggressive, they can.

So how do you guys think about the trade-off between continuing to generate expanding EBITDA margins versus investing for growth? And as we think about growth, what are the top priorities right now?

Yes. We're definitely still, at least we hope, right, quite early in our growth curve. And what we're trying to do is manage the business right now for scale and long-term profit dollars, dollars as opposed to margins. And so you're right that the core restaurant marketplace is kicking off a decent amount of sort of EBITDA profitability. And we are fairly aggressively reinvesting that. And so our intention at this point is not to be expanding margin aggressively or maximizing even unit economics, especially in some of the newer areas. We're very much trying to expand the number of products that merchants find attractive, expand the attractiveness to the consumer and grow the overall scale of the business. In terms of investment areas, look, the fortunate thing is we have lots of areas that can absorb a lot of capital and that generate returns that we think are quite attractive. The core marketplace, still one of those and that's probably, if you're just ranking the biggest area and DashPass would be sort of included in that. New verticals certainly would be a very big area of investment. And international is still a big area of investment. So there's a host of things underneath each one of those as well that sort of if you get to the lower levels where we're investing, but those are the big buckets.

So wanted to talk about Drive a bit. So I guess the first question on this would be, talk about some of the partnerships you've developed over the last quarter or kind of year even within DoorDash Drive? And where are you seeing the most traction in terms of maybe verticals?

Yes. So if you went back a year ago, Drive would have been the vast majority of restaurants. And we've seen the restaurant side grow quite substantially since then. But non-restaurant has grown quite a bit faster than restaurant. And we've seen expansion into grocery and convenience verticals that are also on the marketplace. But we've also seen pharma and general merchandise and retail and pet foods and flowers. And the nice thing about that is, one, it allows these businesses, obviously, to offer something new to their consumers. If they choose, right, not all of them choose, but if they choose, that gives them this sort of minutes, not hours or days type of experience. The other really great thing is it gives us experience working in those verticals. And what we found is that the sort of founding principle of if you build the delivery network around restaurants, which is a very hard problem to solve, that it can scale to other things. That seems to be proving out. Now there are other challenges when you get into all those other verticals around different software stacks that you have to integrate with and just different sort of patterns of behavior or different consumer patterns and all these different things. But the great thing is, the partners have opened up quite a bit to the idea of local omnichannel commerce. And we can provide them a service that's quite helpful for them that also helps us learn, and hopefully, that's valuable over time as we try to expand into more verticals in the marketplace.

And I'm curious to get your vision of where Drive goes over the next, like, call it, 5 years. Are you -- do you think players like Meituan that are ahead of you all provide kind of a road map?

Yes. I mean, Meituan is ahead of us on a lot of things and I think is a really amazing company that is good for us to be conscious of for a number of reasons in a number of areas. And I know it's hard to say they provide a perfect road map just because they're quite different markets. But I think, look, if you get back to the founding vision, we certainly want Drive to be able to support more verticals. We want to expand the number of merchants that are using Drive dramatically. There are a lot of merchants out there that still are not doing this that we think could. And then we want to provide a lot more services. Now this is not necessarily Drive because Drive is its own product, but to do omnichannel local commerce, you need more than logistics. And you need online ordering, you need service, you need a marketing engine, you need a pricing engine. You probably need updated supply chain management. There's a whole host of things. You need a good website. And there are some companies that are doing parts of that extremely well, and we probably can't add a lot of value, but there are other parts that, especially given our experience and the data that we have from the marketplace that we think we'll be able to add value in. And so the vision would be to have a much broader suite of products and be able to deliver those to a lot more merchants.

So how do you guys think about alcohol? We obviously saw one competitor acquire an alcohol delivery. Is that something you guys are thinking about penetrating? And how are you working on that?

Yes. Yes. Of course. I mean, it's a large category that a lot of people are very interested in. And anytime you have consumers that want something and merchants in their community that can provide it, I think we want to make that connection and make it easier for them to connect. So it's certainly something we're thinking about. You can buy alcohol, depending on your geo, on the platform currently, both through restaurants and other providers. And that's something that we want to expand. I think there's a tangential question here, which is sort of M&A in the space. And you can imagine like anything of size, sort of we're taking a look at. And the challenge that we routinely find is our internal expectations of in sort of organic growth and organic investments are quite high. And when you're looking at, especially something that's basically horizontal, you're acquiring customers, you're acquiring merchants, you're acquiring tech and you're acquiring a brand. And in a lot of cases, right, the organic plan ends up being basically a higher return investment because the merchants you can kind of get, for the most part, the customers, a lot of times because of the size of our base are duplicitous or at least largely duplicitous. The tech stack we basically have and then the brand, a lot of cases, you're not going to keep over time. And so what you're buying is sort of time and just the cost at that time relative to our internal hurdles are, is a lot of times, not quite there.

Can you give us an update on DoorDash Kitchen, DashMart, those offerings? How have those businesses grown and what can we think about with respect to how you'll invest in these moving forward?

Yes. So they're a little bit different. Both of them have, I'll call it, a merchant services component to them. In the Kitchens' case or we don't have a consumer-facing offering that stems from the kitchens. It's entirely up to the brands that are renting out that space. And whether they're brands that are looking at it to expand their delivery radius, they have a store in one part of the city and they just want more distribution capacity or whether they're virtual brands. We're happy to support both, but it's on behalf of them. And so it's a pure kind of, yes, merchant services offering. On the convenience side, it's a bit of a mix, and there's obviously more of a first-party sort of consumer offering. And we're quite excited about those. I think there is in convenience in general on our platform, both third party and first party, incredible consumer demand. We're seeing unique opportunities from a product standpoint with bundling in this kind of thing that can help raise awareness for the category and drive incremental velocity. You're seeing consumers that are trying convenience and DashMart's come back to the platform and try new categories at higher rates. So all those things are great. And you're also seeing interesting opportunities to provide merchants, whether it's warehousing-as-a-service or you probably saw the Chowbotics acquisition. We can offer solid restaurants. They can give us their recipes, and we now have a new distribution point for their salads outside of the DashMart. So there's all kinds of like I think, pretty interesting things that we can do with -- once we have that footprint. And so certainly, those -- that's an area we're trying to be quite aggressive in investing in, and if it weren't for the permitting process, we would be going faster than we are.

Okay. I think the last one we have time for is just international expansion. There have been press reports talking about Japan. How is progress going on kind of preparing to do more internationally? And how are you guys kind of approaching which markets to enter, how to enter them? How do you guys see international developing for DoorDash?

Yes. I mean, so Tony and the team's ambition for the business is very high. And we would like to be a generational company and we would like to be a global company. I think there is -- because of that and sort of our investment time horizon for international is quite long. We're willing to be fairly patient. Now at the same time, windows aren't getting more open. And so -- and we're cautious of that. We're perfectly okay entering markets where there's lots of competitors. But really, what we're trying to evaluate when we're looking at new markets is, is there an opportunity for the merchant services side of the business, Drive, Storefront, et cetera, to provide an advantage in that market, either as a stand-alone offering or in helping us scale up merchant supply faster? And are there pockets that are underpenetrated? And if we see those things, then we're perfectly happy going in and competing.

All right. Well, I think we're running out of time. But Andy, it's great to have you. Thanks a lot for speaking with us today and doing meetings at the conference. And hope to get you next year back in person at The Breakers.

Yes, for sure. In-person would be a better experience for all of us, I think.

All right. Well, thanks, again. And operator, we can go ahead and close out the session. Thanks, everyone, for listening.