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The founders of grassroots food delivery service DC To-GoGo are pulling the plug on their platform less than a year after they first went public with their plans. At least for now. Chris Powers, Adam Fry, and Josh Saltzman, who also own Shaw dive bar Ivy and Coney, sought to compete with the mammoth companies that have monopolized the national market.
“We really want to make sure this idea doesn’t die or people see it as a failure of the system,” Saltzman says. “We didn’t quite make it work now, but that’s not to say we won’t come back in the future or we don’t welcome someone else taking it on. It’s important for restaurants to band together and figure out solutions. This problem isn’t going anywhere.”
Fed up with the roughly 30 percent commission fees third-party apps like Grubhub, Postmates, and Uber Eats typically charge restaurants, the trio developed their own pick-up and delivery start-up to keep more money in the hands of bars and restaurants. DC To-GoGo’s commission fees top out at 15 percent—the same percentage the big apps are limited to during the public health emergency in D.C.
DC To-GoGo also aimed to be a better employer than the big third-party apps by guaranteeing couriers $18 an hour before tips and a predictable schedule. (D.C. Attorney General Karl Racine sued DoorDash late last year over the way they were paying their employees and “deceiving consumers” about where their tips were going.)
City Paper checked in with the team in January, eight months after they launched. They outlined challenges like learning and implementing new technology, hiring, and changing customer behavior. Having grown accustomed to scrolling through a virtual smörgåsbord of options on the large, third-party delivery apps, users pressed DC To-GoGo for greater variety in more neighborhoods. The company initially launched in Shaw, but expanded to areas like Capitol Hill and Brookland.
The founders were still trying to massage some pain points in January, but they didn’t let on that they were considering folding. “We’re out of capital,” Saltzman explains. “That’s the biggest problem … Running something like this requires a base level of staff and support and while it’s a scalable model, we’re not at the volume necessary to support payroll.”
Balancing how quickly to expand to new neighborhoods to meet customer demand with deciding how many drivers to have out on the roads was a tricky process. It would have been easier and more predictable if more restaurants committed to exclusively using DC To-GoGo. “We wanted to be everywhere in this city, but the reality is it’s very hard, especially without dedicated restaurants,” Saltzman says. “If they’re on a million platforms, it’s hard to account for volume.”
He fears that the end goal of third-party apps is to set up ghost kitchens to further diminish business at small, independent restaurants and bars. “They’re mining all of the data to see what restaurants are selling and what’s working and they’re going to take that and cut us all out,” Saltzman says.
DC To-GoGo’s last day for the foreseeable future will be Friday, April 30.
“We were rebels from the beginning—some dive bar owners and friends trying to take on billion-dollar tech firms,” Saltzman continues. “We accomplished a lot but the reality is we were under-capitalized and didn’t have enough resources.”