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Grubhub

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Type
Company or group
Role
Other company
Updated
  • Type: Online food-ordering and delivery marketplace (Grubhub, Seamless). Public (NYSE: GRUB) until acquired by Just Eat Takeaway.com: announced June 10, 2020 (~$7.3 billion, all-stock); closed June 15, 2021.
  • Legal entity: Grubhub Inc. (Delaware); since June 2021 a subsidiary of Just Eat Takeaway.com.
  • Founded: 2004, Chicago, by Matt Maloney and Mike Evans; merged with Seamless in 2013.
  • CEO through the pandemic: Matt Maloney.
  • Role in the relief programs: No PPP loan to Grubhub appears in SBA's public loan data. Its restaurants were the small-business class that PPP and the Restaurant Revitalization Fund targeted. Its flagship program deferred restaurant commissions, and its promotions drew a District of Columbia Attorney General lawsuit.

Before the pandemic (2004–early 2020)

Grubhub built the early U.S. online food-ordering market and merged with Seamless in 2013, but by 2020 it was losing share to DoorDash and Uber Eats and running on thin margins.

During the pandemic (March 2020 – 2021)

Restaurant relief: a deferral, then fee caps

Grubhub's first relief offer to restaurants was a deferral of its commissions, to be repaid out of their payouts. On March 13, 2020, with the mayors of several large cities, it announced it was "temporarily suspending collection of up to $100 million in commission payments" from impacted independent restaurants (Grubhub press release, March 13, 2020). The program terms, as Grubhub still posts them, say: "This is not a waiver of the Marketing Commissions." Grubhub expected the relief period to end by March 29, 2020. It would then withhold the deferred commissions from restaurants' payouts in four equal weekly amounts, which it expected to start no earlier than April 13. A participating restaurant also agreed to stay on Grubhub for a year at no lower a commission rate, and granted Grubhub a security interest to secure repayment (Commission Deferral Terms & Conditions). "They told the press they would be waiving. They corrected it later in the day," the co-owner of a Chicago restaurant group told Restaurant Business on March 17, 2020.

Six days after the announcement, in a letter to the President and congressional leaders, Matt Maloney described the program as "deferred payments" and asked them to support the National Restaurant Association's $325 billion aid package (Grubhub CEO letter, March 19, 2020). In May, Grubhub told shareholders: "We were the first to offer deferred commissions." (Q1 2020 shareholder letter, May 6, 2020)

Local governments in various, mostly urban, markets then capped delivery commissions. On the June 11, 2020 call announcing the Just Eat Takeaway.com merger, Maloney said "any fee cap that is under 25% literally doesn't pay for the delivery itself" (Form 425 call transcript, June 11, 2020). Grubhub's shareholder letters later listed the caps among its support for restaurants: it "effectively conveyed more than $50 million to local restaurants" through them in the fourth quarter of 2020, and more than $60 million in the first quarter of 2021. The same letters said caps were "neither an efficient nor the right way" to support restaurants. Grubhub said that without the caps, its fourth-quarter Adjusted EBITDA would have been about $1.50 per order. It reported $0.52 (Q4 2020 and Q1 2021 shareholder letters).

Discounts paid to diners

On April 13, 2020, Grubhub said it would run the second quarter at about $5 million of Adjusted EBITDA. It would reinvest most of the profits it expected into "Grubhub-funded diner promotions, reduced or eliminated diner delivery fees", platform improvements and safety measures (Grubhub business update, April 13, 2020). By its own count it spent about $100 million in the quarter. More than $85 million went to lower diner fees, coupons and advertising, which it estimated drove $200 million of additional gross food sales to partnered restaurants. About $15 million went to its delivery network and safety (Q2 2020 shareholder letter). More than half of the $100 million was booked as a reduction to revenue. Second-quarter revenue rose 41% to $459 million, and Adjusted EBITDA was $13.3 million, against $54.7 million a year earlier (Q2 2020 shareholder letter; Form 10-Q for the second quarter of 2020). "For now, COVID-19 is a net tailwind for our growth metrics," the first-quarter letter had said.

"Supper for Support"

From late March 2020 Grubhub offered diners $10 off evening orders of $30 or more at participating restaurants (Grubhub COVID-19 page, April 2020). The District of Columbia sued Grubhub in March 2022 over hidden fees and misleading marketing, including this promotion (DC Attorney General release, March 21, 2022). Its complaint alleged that restaurants paid the whole $10 and still owed Grubhub its usual combined 30% marketing and delivery commission on the undiscounted $30. On that arithmetic, a participating restaurant kept $11 in gross revenue on a $30 order instead of $21. According to the complaint, Grubhub later offered participating restaurants a credit of up to $250, covering the discount on the first 25 orders (DC Attorney General complaint, March 21, 2022, paras. 92–101). In December 2022 the District's attorney general announced that, as a result of its lawsuit, Grubhub would pay $3.5 million: $2.7 million back to customers and an $800,000 civil penalty (DC Attorney General release, December 30, 2022).

Drivers

Grubhub offered delivery partners "driver support pay": a one-time payment of two weeks' earnings, based on their average over the previous three weeks and no lower than $100. It went to drivers diagnosed with COVID-19 or ordered to self-isolate, with documentation from a licensed medical provider or public health authority (Driver Support Pay page). By May 2020 Grubhub said it had distributed nearly 100,000 protective-equipment kits to drivers who asked for one (Q1 2020 shareholder letter). It also offered contact-free delivery (Grubhub COVID-19 page, April 2020).

Round-up donations

Diners could round up their orders and give the change to the Grubhub Community Relief Fund, which Grubhub set up in March 2020 as a donor-advised fund. The company matched donations from Grubhub+ and Seamless+ members (Grubhub press release, March 13, 2020). In October 2020 Grubhub said "we've raised $12 million" for the fund since March and donated nearly 850,000 meals. It did not say how much of the $12 million came from diners and how much from the company ("Partnering to Fight Food Insecurity in Our Communities," October 19, 2020). In November 2020 the fund recommended a $2 million grant to the Greg Hill Foundation's Restaurant Strong Fund for $10,000 winter grants to independent restaurants in Chicago, New York City, Boston and Philadelphia (Grubhub press release, November 9, 2020; we have a copy). A $4 million grant round announced in October 2021 was to be "funded by donations from Grubhub's Donate the Change program" (Grubhub press release, October 7, 2021).

Staff, pay and taxes

Grubhub's 2020 and 2021 SEC filings disclose no layoffs. Its annual reports put staff at about 2,714 full-time equivalents in February 2020 and about 2,841 in February 2021. Restructuring costs rose $6.9 million in 2020, mainly from closing certain offices (Form 10-K for 2019 and 2020). Maloney's base salary stayed at $710,000, and his total 2020 compensation was $8,308,632, up from $7,835,652 in 2019 (2021 proxy statement). No PPP loan to Grubhub or its subsidiaries appears in SBA's public PPP loan data (September 2024 release). The 2020 annual report records a $9.7 million tax benefit from the CARES Act's loss carryback. Revenue for 2020 rose 39% to $1.8 billion. Grubhub said the $137.3 million rise in its net loss, to $155.9 million, was "primarily driven by significant restaurant support and driver safety spending" (Form 10-K for 2020).

Corporate

Grubhub's pandemic outcome was a sale. After reported acquisition talks with Uber ended, Just Eat Takeaway.com agreed to buy Grubhub in an all-stock deal worth about $7.3 billion, announced June 10, 2020 and closed June 15, 2021 (Just Eat Takeaway completion release, June 15, 2021). Matt Maloney joined the acquirer's board (completion release).

After the pandemic (2021–present)

Just Eat Takeaway later agreed to sell Grubhub to Wonder Group, with the sale completing in 2025 (press reports).

Current posture (as of mid-2026)

Grubhub is owned by Wonder Group following the 2025 sale (press reports). No Grubhub corporate PPP loan or PPP-fraud finding has been found.

  • DoorDash — delivery peer with broader (if temporary) restaurant relief
  • Uber — attempted to acquire Grubhub before the Just Eat Takeaway deal
  • Instacart — delivery peer
  • Postmates — delivery peer acquired by Uber in 2020

Sources

Primary documents in this archive (snapshots flagged for re-fetch; live URLs verified)

External references

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