Food Delivery Billionaires Who Made Fortunes See Assets 'Drain Away' as Pandemic Ends

Restaurant Closures Lifted and Inflation Increases Fees
Food Delivery Service Demand Expected to Plummet

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Hyunjung] The fortunes of billionaires who made huge profits from the boom in food delivery services during the COVID-19 pandemic are rapidly dwindling like a "receding tide" due to the easing of quarantine measures worldwide. As people return to previously closed restaurants, demand for delivery services is expected to sharply decline.

On the 7th (local time), Bloomberg reported, "Emerging wealthy individuals who were born from increased online orders due to restaurant closures early in the pandemic are now in decline."

According to the report, the three co-founders of San Francisco-based food delivery company DoorDash each accumulated wealth exceeding $2.5 billion (approximately 3.1375 trillion KRW). Jitse Groen, founder of Europe's Just Eat Takeaway, also made headlines with a fortune of $1.5 billion.

However, the report stated, "In an environment returning to dining in restaurants rather than delivery or takeout, investors are no longer favorable toward such services," diagnosing that "this wealth now seems like a mirage."

As the pandemic transitions to an endemic, the stock prices of food delivery service companies, which had surged sharply since 2020, have begun to plummet. On the New York Stock Exchange, DoorDash's stock closed at $69.95 per share, down 50.93% compared to the previous year. On the London Stock Exchange, Deliveroo closed at $99.42, a 61.31% plunge from a year ago.

According to Bloomberg's Billionaires Index, Groen's stake in Just Eat Takeaway has fallen to about $350 million. DoorDash founders Andy Fang and Stanley Tang are no longer billionaires, and CEO Tony Xu's net worth has dropped to $1.1 billion. Additionally, Deliveroo's Will Shu saw the company's equity value shrink from $620 million in August last year to $150 million recently. Mott Smith, CEO of MTY Kitchen, which rents kitchen space, explained, "The lifting of lockdowns has shown us the limitations of food delivery."

The report noted that while most companies' revenues are still growing, over $100 billion in market value has evaporated. Recent inflation and recession forecasts also darken the future of such services. Consumers are expected to prefer buying food directly or eating less rather than paying extra fees for delivery. Diana Gomes, a Bloomberg Intelligence analyst, evaluated, "The uncertainty shaping the new normal due to inflation and demand changes is at an unprecedented level."

This content was produced with the assistance of AI translation services.