Deliveroo boss Will Shu: ‘I was never into start-ups’

“I never set out to be a founder or a CEO. I was never into start-ups,” says Will Shu, founder of food delivery chain, Deliveroo.

The firm, founded in 2013, is now planning to issue shares to the public which could value it at $7bn (£5bn)

Deliveroo has not yet made a profit and it reported a £223.7m loss for last year, despite a surge in sales.

The float will see the busiest riders share in a £16m fund, and customers will also get the chance to buy shares.

They will be given the chance to buy up to £1,000 worth of shares each in the firm, although if demand if high they may see their orders scaled back.

Mr Shu’s letter, contained in the official notice of the intention to float, also says: “I’m not one of those Silicon Valley types with a million ideas. I had one idea.

“At the end of the day, I started the business because I wanted something better than what was available to me.”

Deliveroo driver

Deliveroo said that last year, its gross transaction value – the total amount of transactions it processes on its platform – jumped by 64.3% to £4.1bn from £2.5bn in 2019.

However, the business remains loss-making, although its underlying loss for 2020 reduced to £223.7m from £317.3m in 2019.

Demand for takeaway meals has soared during the coronavirus pandemic, after lockdown measures were first implemented a year ago and restaurants have been forced to close. 

Restrictions on hospitality businesses in England are currently set to start to ease on 12 April at the earliest.

As part of the flotation, riders in Deliveroo’s 12 markets who have worked with the firm for at least a year will be paid a bonus of either £10,000, £1,000, £500 and £200 depending on the number of orders they have delivered.

Deliveroo also said it would make £50m worth of shares available to customers who would be able to register their interest via the company’s app.

Share structure

The shares will be listed on the London Stock Exchange, where Will Shu is planning to maintain a firmer grip on how the company is run than has been traditional for London-listed companies.

Under a proposed dual-class share structure, each share Mr Shu will hold will carry 20 times the voting power of ordinary shares.

A recent government-commissioned review of the UK’s listing rules recommended a number of measures to make the country a more attractive place for companies to float.

The review, led by former European Commissioner Lord Hill, recommended allowing different classes of shares with differential voting rights.

Major tech companies such as Facebook and Google-owner Alphabet have so called dual-class shares.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.