DoorDash, a food delivery service provider has signed a deal with Square to buy its on-demand meal delivery and catering platform, Carviar.
The closing amount of the deal has been decided on $410 million in cash and preferred DoorDash stock.
In this deal, it has also been confirmed that Caviar’s lead, Gokul Rajaram, will join DoorDash along with all other employees of Caviar.
Jack Dorsey, CEO of Square said, “Square became the parent company of Caviar five years ago in a deal worth about $90 million. But, the current deal has offered an opportunity to Square to focus on its products for businesses and individuals.”
“We are increasing our focus on and investment in our two large, growing ecosystems – one for businesses and one for individuals. This transaction furthers that effort, and we believe partnering with DoorDash provides valuable and strategic opportunities for Square,” Jack added.
DoorDash Delivery had been in the news for its payment system to its delivery personals. According to the company, it does not subsidize wages with tips and the payment system it follows is effective for its workers.
Tony Xu, CEO of DoorDash said in a statement that, “Today’s announcement is another important step forward on our mission to empower local economies.” He added. “We have long-admired Caviar, which has a coveted brand, an exceptional portfolio of premium restaurants and leading technology. The acquisition further enhances the breadth of our merchant selection, enabling us to offer customers even more choice when they order through DoorDash. We look forward to welcoming the Caviar team to DoorDash and expanding our partnership with Square in the future.”
In an interview Gokul stated, “Caviar has built a trusted brand with customers and many of the best restaurants. DoorDash has national scale, complementary restaurant selection, a tremendous logistics platform, and a team that shares our passion and commitment to better serve restaurants, couriers, and customers. I’m incredibly excited to be joining, with the rest of the Caviar team, to help build the future of local commerce.”
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