Eight years after the company’s 2013 inception, Deliveroo’s IPO is finally being cooked up by founder William Shu. To strain the metaphor further, you could even say that the initial public offering has left the kitchen and is on its way to your door, having been pencilled in for a delivery in Q1 2021.

As of this week, £50 million worth of shares are now available to retail investors and customers, provided they have registered their interest via the company’s app. (If you want to order a pizza to celebrate your investment while you’re at it, that’s up to you).

“Far too often normal people are locked out of initial public offerings,” founder Will Shu said as he announced the IPO. It’s Shu’s mission, he claims to give “as many customers as possible the chance to become shareholders.”

Each customer will be able to get their hands on a not insignificant £1000-worth of shares.

This despite the fact that Deliveroo remains a loss-making company, having posted losses of some £222 million in 2020 as the Covid pandemic forced us all to grasp our pennies tighter and focus on perfecting our banana bread recipes instead of ordering in.

However, this is an improvement on the £317 million loss the company suffered in 2019. Despite this, as

, the company’s revenues did climb to £4.1 billion in 2020, a significant increase from £2.5 billion in 2019.

But, with Goldman Sachs and JP Morgan Cazenove appointed as joint coordinators of the IPO (which has not yet had a date confirmed), the company could be valued at up to $10 billion (£7.2 billion) following a $180 million (£130 million) round of funding taking its initial valuation to a confirmed $7 billion (£5 billion).

“I’m not one of those Silicon Valley types with a million ideas,” said Shu in a letter included in the company’s ‘expected intention to float’ letter, filed on Monday 8th March 2021. “I had one idea,” he said. “One idea born out of personal frustration. An idea that I was fanatically obsessed with: I wanted to get great food delivered from amazing London restaurants.”

Shu is well on the way to achieving his dream: Deliveroo currently boasts a client base of 115,000 cafes, restaurants and takeaway vendors across 200 cities in a dozen countries with monthly takings comfortably in the six figures.

But not everyone is convinced. “This valuation of Deliveroo seems excessive for a business which is still many years from profit, especially given that some hold significant doubt whether the home takeaway delivery model can become profitable outside of London,” John Colley, associate dean of Warwick Business School, told

However, with rivals like Uber Eats and JustEat taking a slice of the market (

worth £8.5 billion in the UK, as of 2019

), Shu is surely confident the IPO will allow Deliveroo’s piece of the pie to grow ever larger.

“Our ambitions have increased as we start to truly understand and execute on the opportunity in front of us in online food,” he said, adding that the company is “just getting started”.

Shu got his own start in Connecticut in 1979. Born to Taiwanese parents, Shu studied at Northwestern University

 going to work with Morgan Stanley as an investment banking analyst in 2001. In 2012, he earned an MBA from Wharton Business School.

It was while working in Morgan Stanley’s London office that the idea for Deliveroo came about. Like the best ideas, it was driven by hunger. Burning the midnight oil and finding himself peckish, Shu became frustrated at the lack of after-hours delivery options in the City.

He recruited Greg Orlowski, childhood friend and software engineer to help him bring the idea to fruition, with Shu

 working as the company’s very first delivery person for every night for eight months straight in order to better understand the customer experience. (

 have it that he once worked for JustEat as a delivery driver to size up the competition).

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The company steadily grew via word of mouth then, in 2015, it expanded to Paris, Dublin and Berlin before reaching a valuation of more than

. In the meantime, Orlowski, the company’s former chief technology officer had left to spend more time with his family in 2016.

Now the remaining founder, as of 2017 at least, Shu

 to still take the occasional delivery shift. Shu’s hands-on approach to the company will only be strengthened by the IPO which will operate under a dual-class structure.

Pioneered by Google and Facebook, the approach allows Shu to retain 20 votes per share, with other shareholders entitled to just one, giving Shu greater control over the direction of the company. The system will be in place for the next three years and comes after the UK government backed calls for reforms to London’s listing system, including the ability to list dual-class shares.

UK authorities have previously taken an interest in the company when the country’s antitrust regulator, the Competition and Markets Authority (CMA), froze a $575 million funds injection from Amazon (for which the company received a 16% stake in the business).

The CMA argued that Amazon’s investment would reduce competition because it made it unlikely Amazon would re-enter the food delivery market. Then, after Deliveroo complained it would go out of business without the cash, the CMA approved the deal in August 2020.

Like most companies in the sector, Deliveroo has not been without its share of controversy...

Like most companies in the sector, Deliveroo has not been without its share of controversy. In 2016, Shu himself

 after boosting his own salary by 22.5% to £125,000 per annum in the midst of an ongoing dispute into its delivery drivers’ status within the company.

Gig-economy companies like Deliveroo are notoriously difficult to legislate, being a relatively new and growing form of business. Uber has arguably taken the brunt of the backlash of a model in which workers are not employees with a fixed salary, but are paid for the ‘gig’s (read: deliveries, journeys etc) they complete.

“According to one definition, it is “a labour market characterised by the prevalence of short-term contracts or freelance work, as opposed to permanent jobs”,” quotes one

In November of 2017 a UK employment tribunal ruled that Uber’s drivers should be treated as employees and are entitled to a minimum wage, sick and holiday pay and other benefits – a ruling that was upheld in February 2021.

 dealing with workers’ rights litigation brought against it by 45 of its delivery drivers in 2018. The High Court ruled workers hired by Deliveroo are “not entitled to collective bargaining.”

, at the time, Jason Moyer-Lee, general secretary of the Independent Workers Union of Great Britain (IWGB) opined, “Today’s judgment is a terrible one, not just in terms of what it means for low-paid Deliveroo riders, but also in terms of understanding the European Convention on Human Rights…Deliveroo riders should be entitled to basic worker rights, as well as to the ability to be represented by trade unions to negotiate pay and terms and conditions.”

Deliveroo’s then UK managing director, Dan Warne, counter argued that the verdict was “a victory for riders who have consistently told us the flexibility to choose when and where they work, which comes with self-employment, is their number one reason for riding with Deliveroo.”

Perhaps in an attempt to address the foibles of the gig economy model, Deliveroo is planning to shell out £16 million to its 100,000 or so workers through a ‘Thank You Fund’ to be established alongside the IPO.

Representatives from the company have said Deliveroo is offering riders cash as it cannot legally give them access to shares in the IPO as they are not employees.

, the most loyal riders could be given £10,000 while others will receive incrementally smaller packages of £1,000, £500, £200 or £100, all depending on how many orders they have delivered for the company. The average payment is thought to be just £440.

“This is just another PR stunt by Deliveroo to try and divert attention from a workforce that has been exploited since the company’s inception,”

, president of the IWGB union. “This does not come close to compensating riders for a lifetime of precarity and poverty pay. They should call it their apology fund.”

Shu, sees it differently. “I want to thank our riders who have been working with us for years, delivering great food and such a fantastic experience for our customers. They have been central to our growth and will continue to be,” he said in a statement regarding the ‘Thank You Fund’.

Still, while the riders may be central to the company’s future growth, it seems that however successful Deliveroo’s IPO, its workers will mostly remain hungry.

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