Chris Jeffrey, CEO

In July, Groupon acquired OrderUp for $69 million. A quarterly report filed with the SEC discloses the purchase included a contingency of an additional $20 million after valuation of OrderUp’s assets, for a potential total of $89 million. For more details of the deal, read Technical.ly Baltimore’s coverage here.

Chris Jeffery is the co-founder and CEO of OrderUp, a multi-city online food ordering franchise. Started in 2009, OrderUp allows customers to quickly and conveniently browse menus and order from a selection of restaurants local to a town, city, or geographic region. The service has provided thousands of businesses with delivery capabilities, expanding those restaurants’ revenue and reach. Last month, OrderUp was acquired by Groupon.

Q. How does OrderUp work?
CHRIS JEFFERY: OrderUp is what we call a complete food delivery marketplace for hometowns nationwide—available online as well as mobile—to find your favorite restaurants to get delivered to your doorstep, whether that be at home or office. The way that the platform actually works is, if you if imagine a hood of a car, that opening sentence that I just told you is what people see: what the average consumer sees, the restaurant sees, and the driver sees. But when you open up the hood of the car—the hood of OrderUp’s car—you really see a platform that connects those three stakeholders: consumers, restaurants, and drivers. All the magic happens under the hood there. It starts with great technology, great operations, using data science to make sure that you’re connecting the dots in a way that’s beneficial for all the stakeholders. And when you can do that, and do that in a profitable manner, that’s when it really becomes exciting to see how big you can actually get.

Q. What are the benefits of using third-party drivers?
A. We do work with independent contractors and you know, we enjoy working with these independent contractors and letting them set their own schedules. They work when they want to work and make as money—frankly—as they want to. Now our job is to make sure that they’re getting business, so our job is to make sure we’re getting great restaurants to work with, connecting those restaurants with consumers so they place orders, and then doing that in a way that’s efficient so we’re not sending drivers all over the city. So, when they look at their hourly wage they’re saying, “Okay, this is a profitable proposition for me as an independent contractor.”

Q. Where do you see OrderUp’s position in the overall food delivery market?
A. We believe we’re navigating the space well. I think there are things we’re learning every day. We’re taking cues from bigger players out there. We’re also working with some of the best legal teams out there to make sure that we’re crossing our T’s and dotting our I’s in this space and that’s very important. The complaint side of the space is definitely something you have to keep your eye on. I use a term around here called “double down.” We’re constantly doubling down, and just last week, as many know, we were acquired by Groupon.

Q. What does the acquisition mean for your business? Will OrderUp be moving out of Baltimore?
A. The best news for Baltimore is that we’re going to be able to keep our brand and keep our headquarters here. We’ll continue to grow our presence here and hire more folks here—more talented folks here—and continue to build up this market as an OrderUp market. Then, Groupon has plans for building up major metros with their resources.

Q. How did the conversations with Groupon start?
A. So, we’re actually raising a series B at the time, and a couple of bigger public companies started showing interest in what we’re doing—our technology, our team. If you remember, we just hired a new COO who was the former COO of Dominos, and were getting delivery right and that’s not an easy thing to do.

Being in Baltimore, you’re not necessarily the first top of mind when a larger public company wants to maybe acquire this technology or team. In the space, they look out at San Francisco or New York, and so we were just chugging along, minding our own business. I actually had known a guy by the name of Jason Harinstein, who’s the SVP of Corporate Development at Groupon, and I had known him for a while now, and he reached out and said, “Hey, they’re interested in this space.” We had some initial conversations, and one thing led to the next. Really, what I saw with Groupon is that this space is moving fast and access to capital and resources is increasingly more important every day, frankly. If you look at their balance sheet, if you look at the reach that they have in the US and globally, they have a lot of resources we can leverage and we can use to continue building up Orderup. Also, they can leverage what we’ve built to build out their efforts in Chicago and San Francisco and Boston and Austin, and all those cities that they want to go after.

There were lots of times we had some frustrating challenges that we had to overcome, but we saw a bigger opportunity, and what’s most exciting is that you have a public company—Groupon—that also shares in that vision, that bigger opportunity, on a much bigger scale than we’re at today. So if we can achieve that faster with them, which we ultimately we decided we could, then that’s great. We can continue doing what we love to do and continue bringing great experiences to consumers, restaurants, and drivers across the country.

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