Good afternoon.
I assume many of you may have read or at least heard about this don’t-call-it-a-prediction-post, prediction post about a doomsday AI scenario. This one wipes out white-collar work, crashes the economy, and potentially bankrupts modern-day commerce giants like DoorDash.
The Substack piece actually caused a mini stock market sell-off this week, which, depending on your worldview, could either mean that it was a very smart post or that it was skimmed by some very dumb public-market investors.
Either way, I do think it was misguided about some of these platforms’ advantages and how they would or wouldn’t defend their position.
“The DoorDash moat was literally, ‘You’re hungry, you’re lazy, this is the app on your home screen,’ the piece argued. ‘An [AI] agent doesn’t have a home screen. It checks DoorDash, Uber Eats, the restaurant’s own site, and twenty new vibe-coded alternatives so it can pick the lowest fee and fastest delivery time.’”
I will disclose that the main time I use DoorDash or a rival is on a busy work trip, because my wife and I are otherwise way too frugal to consistently pay for the food markups and fees that others happily do. But I have gotten to know the company pretty well after conducting several months of reporting last year for an in-depth feature published in Fortune.
And the Citrini piece definitely overlooks some of the key reasons that DoorDash is twice as large as its next biggest competitor in the US. For one, the company often locks up the most popular high-volume takeout restaurants with exclusive deals. All roads from an AI agent to these popular restaurants would still have to flow through DoorDash. Secondly, the company has also built up its paid membership program DashPass into one that gives customers reasons to return to the app that have nothing to do with finding the lowest price every time. Loyalty is slow to break down.
More broadly, this kind of analysis assumes leaders simply sit back and get disrupted. Yes, history shows us that some will be slow to react or succumb to the innovator’s dilemma. But founder-led, tech-forward companies like DoorDash are more likely than not to use these very same technologies to adapt, and to blunt these new threats.
In fact, one of my interviews that didn’t make it into my Fortune feature was with DoorDash co-founder Andy Fang, whose entire role at the company is focused on peering around corners and figuring out how the company should go on the offensive by utilizing AI.
Fang was candid when he told me, “in some ways, we feel like we’re already behind—which we are, if we’re being intellectually honest—compared to some of these startups.” That was back in the fall. But the work he described the company doing to catch up has me betting that DoorDash has a better chance than most to weather whatever real, or imaginary, AI storms are on the horizon.
Now on to the good stuff…
The Center Aisle
The headlines this week suggest a sector in its ascendancy: one of the leaders in the SEO for AI space, Profound, announced new funding at a $1 billion valuation. Early subscribers may recall that I interviewed the startup’s co-founder and CEO James Cadwallader for this here newsletter back in December. (It’s hard being so prescient…I kid.)
Yet in conversations this week with a half-dozen consumer brand leaders, the sentiment was noticeably more restrained.
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