Feb. 15--For generations, delivery meant pizza or Chinese takeout.
Now the on-demand economy, having already upended the way people hail a ride or book a place to stay, is increasingly taking aim at what we put on our dining tables and expanding the menu in the process.
You can have spicy clam and chorizo pasta delivered by Munchery one day, a Godmother sandwich from Bay Cities dropped off curbside by UberEats on another, or come home to a box of ingredients for chicken schnitzel from Blue Apron if you're in the mood to cook.
Though delivery is certainly not a new phenomenon, analysts say consumers have been empowered by the ease of ordering from an app and have grown accustomed to purchasing goods online.
"Consumers want the 'dining out' experience of quality food, but they're saving money and time by having food delivered to their homes," said Bonnie Riggs, restaurant industry analyst for research firm NPD. "There is the appeal of being in the comfort of their own homes and not having to deal with the hassle of the outside world."
Funding has poured into the space as hungry investors chase the high valuations that have characterized other on-demand stalwarts such as Uber and Airbnb.
On-demand food tech start-ups raised a record $5.7 billion globally last year, an increase of 152% from 2014, according to CB Insights.
That's generated concerns about overcrowding in the sector.
Many start-ups are merely doing the same thing and battling for the same customers. The competition has made it difficult to retain delivery drivers or secure the additional funding needed to properly expand.
"When we look at the environment in 2016, food delivery is an area where we expect consolidation and a more scrutinized funding environment," said Matthew Wong, researcher and data analyst at CB Insights who focuses on start-up industries and global trends. "In this market especially, it looks like it'll be difficult to raise further rounds of funding."
If your business isn't already up and running and gaining traction, chances are it's already too late.
There's also the price factor. Many of these new services make sense for middle- to upper-middle-class urbanites, especially single people or couples. A working family of four, however, can't afford to spend $40 a night on a dinner on a regular basis.
"Food is such a big segment of consumer spending, and we're going to see companies emerge as big players here," Wong said. "Some companies in the space might lose, but the space as a whole won't."
Before downloading your food app, get to know the three main categories that make up the industry:
Restaurant delivery
This is the obvious one. A company with consumer-facing software partners with local restaurants to take care of ordering and delivery. Restaurants get to serve more customers and they often don't have to bother with the hassle of hiring someone to drive across town.
One of the biggest players is GrubHub, a Chicago company that went public in 2014. (Like most tech stocks, its shares have tumbled since last year.) GrubHub connects customers to local restaurants, offering pickup and delivery via contracted couriers. The company transacts 227,100 orders a day for its 6.7 million active diners.
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