Mar 12, 2025 · 1h 12m · 20vc
Niklas Östberg, Founder @ Delivery Hero: Competing with Uber and Doordash in a Capital Arms Race · 20VC with Harry Stebbings
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In this deep-dive interview on the 20VC podcast, Delivery Hero CEO and co-founder Niklas Östberg discusses the hard-earned lessons of scaling a global logistics giant, explaining why disciplined execution, sustainable unit economics, and local leadership outweigh raw capital and hyper-growth hype.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 16.7% of the talking time here. How this is scored →
Harry as informed peer 2.7 Guest teaching 3.5 Guest disagreement 1.5 Harry pushing back 2.1
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 58:15 Niklas rejects public market enterprise valuation metrics
Niklas dismisses Harry's assertion that emerging market multiple discounts damage enterprise value, explicitly rejecting the focus on public market pricing over intrinsic long-term value creation.
Hardest push from Harry ▶ 38:07 Harry challenges cohort consistency assumptionsHarry directly interrupts Niklas's thesis on M&A predictability, challenging whether cohort retention holds as market expansion moves away from ideal customer profiles.
Biggest teaching moment ▶ 17:56 Niklas reframes the core responsibilities of a CEONiklas explicitly rejects Harry's stated premise that top CEOs are primarily capital allocators, explaining that driving culture, organizational speed, and operational execution are vastly more important.
Harry holds his own ▶ 25:52 Harry exposes logical tension between execution speed and capital allocationHarry uses Niklas's own 'speed of execution' mantra to push back on his claim that capital allocation requires removing oneself from speed mode, forcing Niklas to introduce a Bezos-style reversible door framework.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Resilience, Athletics, and Childhood Roots | 1 | 1 | 0 | 0 | Harry opens with friendly icebreaker questions about Niklas's childhood cross-country skiing and personal resilience. Niklas answers agreeably with personal reflections on focus, purpose, and staying grounded. | |
| Navigating COVID-Era Strategies | 2 | 3 | 1 | 2 | Harry asks targeted questions regarding COVID-era missteps and the choice between raising debt versus equity. Niklas candidly explains how greed prevented them from diluting at peak stock prices. | |
| The Courage of Contrarian Leadership | 1 | 2 | 1 | 1 | Harry prompts Niklas on contrarian leadership decisions. Niklas explains why doubling down on logistics and selling Delivery Hero's home market in Germany were key contrarian wins. | |
| Why Delivery Hero Sold Its Home Market | 4 | 5 | 3 | 4 | Harry pushes back on selling Germany and challenges the idea that food delivery is a winner-take-all market by citing Deliveroo and UK dynamics. Niklas corrects the premise, arguing multiple profitable players can coexist in scale markets. | |
| Execution Over Competition in Food Delivery | 2 | 4 | 2 | 1 | Niklas breaks down customer lock-in mechanics and explains how experience shifted his view from 80% competition focus to 80% internal execution. | |
| The Power of Simplicity and the Role of a CEO | 3 | 5 | 3 | 2 | Harry cites the business axiom that top CEOs are primarily resource allocators. Niklas directly disagrees, arguing culture and organizational speed are far more critical than capital allocation. | |
| The $200M Gorillas Investment & Learning from Gravity | 3 | 4 | 1 | 3 | Harry quotes Keynes to press Niklas on when to abandon a belief facing conflicting data. Niklas reflects on losing $200M on Gorillas and learning to trust underlying cohort models like gravity. | |
| Strategic Capital Allocation and Buy vs. Build | 3 | 4 | 2 | 4 | Harry points out an explicit contradiction between Niklas's insistence on extreme speed and the need for slow deliberation on capital allocation. Niklas resolves this by distinguishing reversible from non-reversible decisions. | |
| Fostering Speed at Scale through Low-Level Ownership | 2 | 3 | 1 | 1 | Harry asks how to maintain organizational velocity without European slowness creeping in. Niklas outlines low-level ownership structures and output-driven culture metrics. | |
| Daring to Find Your Own Authentic Leadership Style | 2 | 2 | 0 | 1 | Harry asks about unconventional management practices and early leadership missteps. Niklas reflects on overcoming imposter syndrome by embracing personal authenticity. | |
| Empowering Local Entrepreneurs through Micro-M&A | 3 | 4 | 2 | 2 | Harry brings up Delivery Hero's 35+ M&A track record. Niklas corrects the common misconception, clarifying that most acquisitions were tiny early-stage local teams rather than large corporate buyouts. | |
| How Market Evolution Shifted M&A vs. Build Strategy | 5 | 5 | 3 | 5 | Harry forcefully pushes back on cohort assumptions, asking if expanding target markets degrades cohort quality and whether paying two billion for Glovo was justified. Niklas defends the deal math using 20 years of predictable cohort data. | |
| Understanding Cohort Strength and Unit Economics | 3 | 4 | 1 | 2 | Harry asks what cohort behaviors signal underlying strength. Niklas explains basket size dynamics and how heavily discounted orders attract non-loyal deal hunters. | |
| Reflections on the Unsustainable Venture Capital Bubble | 3 | 4 | 1 | 2 | Harry asks if the recent VC capital bubble was net positive. Niklas explains that excessive funding temporarily distorted cohort metrics without changing underlying long-term demand trends. | |
| The Hard Lessons of Global Tech Migrations (Turkey Case Study) | 2 | 4 | 1 | 2 | Harry inquires about instances where local teams resisted operational centralisation. Niklas shares a detailed case study from Turkey where hesitating to enforce global tech stack migration caused competitive loss. | |
| The Truth About DoorDash and Uber Eats as Threats | 4 | 5 | 3 | 3 | Harry asks if balance sheet heavyweights like DoorDash and Uber Eats represent existential threats. Niklas rejects the premise, explaining that capital size cannot overcome poor unit return requirements, citing Delivery Hero's own failed hyper-growth experiment in Thailand. | |
| Defining Path-to-Profitability and Market Viability | 4 | 5 | 3 | 4 | Harry argues that public markets heavily discount enterprise value multiples for emerging market exposure. Niklas pushes back on public market short-termism, insisting long-term value creation overrides transient price multiples. | |
| Successful Early Acquisitions and Returns | 2 | 3 | 1 | 1 | Harry asks for Niklas's single best M&A deal from an ROI perspective. Niklas highlights Talabat's 100x+ return and transitions into discussing European entrepreneurship strengths. | |
| The Impact of European Over-Regulation and the Need for a Level Playing Field | 4 | 3 | 2 | 3 | Harry quotes Glovo founder Oscar Pierre regarding European regulatory burdens. Niklas agrees that EU regulators fail to enforce a level playing field against foreign US and Chinese tech giants. | |
| Introduction to the Quick Fire Round & Views on Generative AI | 2 | 3 | 1 | 1 | Harry starts the quick-fire segment. Niklas offers a contrarian view that average corporate adopters will extract far more economic value from AI than the Magnificent 7 infrastructure builders. | |
| Admired CEOs and the Future of Drones vs. Robotics in Delivery | 3 | 4 | 1 | 2 | Harry asks about admired CEOs and drone delivery timelines. Niklas explains why ground robotics will scale far faster than aerial drones due to urban airspace constraints. | |
| Personal Insights on Happiness, Teamwork, and Marriage | 1 | 1 | 0 | 0 | Harry finishes with reflective personal questions on wealth, relationship longevity, and future outlooks. Niklas responds thoughtfully to conclude the interview on a warm note. |
Statements from this episode (48)
Delivery Hero scaled Thailand to 400k daily orders unsustainably in one year
“If you take our Thailand business, we scaled from a couple of thousand orders a day up to 400,000 orders a day in less than a year, but it was not sustainable.”
Östberg: Delivery Hero was overvalued at its peak and is undervalued today
“We were definitely overvalued, and we are probably undervalued today.”
Östberg made and rapidly lost a stock market fortune in the 1990s
“I remember back in the nineties, I was investing in the stock market. I thought it was amazing. I made a lot of money. I lost it very quickly and realized that maybe I'm not that great after all.”
Östberg: Founders are never as good or bad as market conditions suggest
“You, you're not as good as you think you are in the good times and probably not as bad as you think in the bad times.”
Östberg: Delivery Hero should have raised equity over debt at $35B valuation
“If we would have known that we would have cut costs A lot faster earlier. We would have probably taken down risk a little bit. We would have saved as much money as we can. We probably would have raised equity instead of debt during the time when we thought tha…”
Östberg: Founders should accept equity dilution over taking on debt at peak
“It's better to dilute and not, not think too much about it.”
Delivery Hero cut $100M–$200M by exiting Germany and Japan in late 2021
“Back in end of 2021, We felt a little bit worried about the market. We shut down Germany and Japan. We cut a 102 hundred million out of our budget before the year even started.”
Delivery Hero lost $6M on its first logistics initiative before rebuilding
“The first initiative we did, we lost six million. It looked terrible. And most people have probably given up there, but we shut down that company and rebuilt it again and invested the 1000 of million in logistics.”
Östberg: Selling Delivery Hero's German home market made the company stronger
“I think the same selling our home market was clearly a contrarian decision. Maybe some investors thought it was okay, but I think in the company there was a very contrarian view to sell your home market. But I think that that made us incredibly strong.”
Östberg: Delivery Hero sold its German home market due to M&A regulations
“And back then, so this was 2017, and I felt that the market is not as big as it looks. It has a strong comparator there, and there will be no way of consolidate that market later on, given the regulation around M&A and so on. So I think, I thought this is goin…”
Östberg: Food delivery is not a winner-take-all market
“No, I don't think it's a winner-takes-all market. I probably changed my view there. Proven wrong, frankly.”
Östberg: Just Eat, Deliveroo, and Uber Eats are all profitable in the UK
“Just Eat, Deliveroo and Uber Eats, and they all make money in the UK, I would say decently so.”
Östberg: Deliveroo is undervalued by public markets and will continue growing profitably
“And we can argue if Deliveroo is correctly valued today, I would argue they are too low value today. I don't know. It's a profitable business. It's growing and will continue to grow and it will make more money. So, so I do think that it's clear value in that b…”
Östberg: Antitrust regulations prevent food delivery consolidation in the UK
“Now, I don't think that there is, it's possible to consolidate UK and a few other market due to high trust. Reasons. So you can probably not consult at Deliveroo and just eat the Uber and Deliveroo and so on.”
Delivery Hero became market leader in Spain, Italy, Poland, and Norway
“We entered as a number two and number three, number four player in those markets. And we are now the largest.”
Östberg: Delivery Hero's success is 80% internal execution and 20% competition
“I think what I've learned over the years is 80% our own execution. That is going to matter for how big we get and how much money we make, and then maybe 20% driven by competition.”
Östberg: Second-place food delivery players can be profitable if they reach scale
“So yeah, as long as you get scale, you will make money regardless if you're number two or number one. Of course, if you're number two, you will have less scale. You will make less money, but you will still be able to make money.”
Östberg: Driving organizational speed is more important for CEOs than capital allocation
“I do agree that the best CEOs are exceptionally good capital allocators, but I don't think it's the most important part of a CEO's job. I think it is an important job, but by far not the most important. I think more important is to drive the culture. You drive…”
Östberg: Quick commerce will eventually exceed 50% of Delivery Hero's business
“And I think right now that's a big part of our business and long term is going to be more than 50% of our business. So larger than food for sure.”
Delivery Hero lost the vast majority of its $200M investment in Gorillas
“Yeah, we put in close to two hundred million dollars. We got some of it back, a small portion back. But yeah, it was, most of that was lost.”
Östberg: Delivery Hero's $200M Gorillas loss was only 0.5% of its market cap
“Yeah, so, so, and of course, going back to this two hundred million mistake also done here that we were a thirty five billion company. So this was Back then, less than a percent. It was a half a percent of our market cap that we felt like we are willing to tak…”
Delivery Hero grew Talabat from 60,000 to 20 million monthly orders
“So if I give some of the examples was acquired when the company did 60,000 orders per month. And today it does maybe twenty million orders per month, or close to at least.”
Östberg: Uber proved food delivery companies can succeed as late entrants
“Uber and others entered the market and proved that you can start this business way later than we did”
Östberg: Delivery Hero currently prefers organic building over M&A acquisitions
“I think if you look at things right now, we probably prefer to build.”
Östberg: Delivery Hero was disrupted by Rappi in Colombia
“We didn't do that fast enough in, in Colombia, as a good example, and we get disrupted by Rappi. So then the cohorts deteriorated big time.”
Östberg: Glovo's business margin per order will reach 10% to 13%
“So in the end, we know that the margin on the business is going to grow to 10, 10 to 13% over time.”
Östberg: Glovo was losing $330M annually when Delivery Hero acquired it
“And global, we lost three hundred thirty million. When we acquired it”
Östberg: Glovo will outgrow the rest of Delivery Hero's overall business
“I think that was an incredible acquisition only diluting Yeah, a few percent less than a 10% for a business that is, is clearly gonna outgrow the rest of the business.”
Delivery Hero took years to reach per-order break-even in logistics and quick commerce
“So for example, with logistic, it took a couple of years before we were broke even per order basis in, in, in logistic, same with DMART and the whole quick commerce. It took us a couple of years to be break even per order basis, but we didn't, it was not becau…”
Östberg: Unprofitable delivery subsidies only attract temporary low-value discount hunters
“If someone is willing to make a loss per order without that trajectory for getting profits, They might get some of the discount hunters and hunters, and the low value customer base might go to that competitor, but it, but it's not sustainable. So eventually th…”
Östberg: The food delivery capital bubble did not advance the industry
“I don't think it moved industry forward that much. I think it just drove some non-sustainable behavior and same here.”
Östberg: The COVID-19 pandemic was ultimately not good for Delivery Hero
“So I think effectively in the end, COVID was not a good thing for us.”
Delivery Hero's Turkey tech migration took two years to fully recover from
“And we had to make a full massive migration that took nine months. Because you had to move everything at once. That took a big hit on the business and it took two years to fully recover from that.”
Östberg: Large competitor balance sheets are not a threat in food delivery
“I don't think that the balance sheet matters. I don't know. In the end, that is not what limits any compared to spend money. It's going to be the return that is going to limit a compared to spend money. So it's going to be hard for a door dash or Uber or somew…”
Östberg: Almost every geographic market in the world can work for food delivery
“But I don't think it's about a market. I think every, I don't know, almost every market in the world would probably work with this. It's just a matter of getting that product market fit right.”
Östberg: The best expansion markets often require years of losses to scale
“So in the end, sometimes it could be that the best markets are the ones that's going to cost a lot of money for a number of years because you want to invest to grow it. So it's not necessarily that the best market will be fastest to break even. It could be tha…”
Östberg: Onlinepizza was fully bootstrapped and profitable almost from day one
“I was part of starting was online pizza. It was a completely bootstrap, no investors at all. So we were break even almost on the first day of our business.”
Östberg: Delivery Hero achieved a 100x return on its Talabat acquisition
“Look at Talabat. It was a little bit more expensive, but they were doing, yeah, seven to 8000 monthly orders, and now that is a ten billion business. So that is a hundred times return or so.”
Östberg: Delivery Hero generated multiple 100x and 1,000x returns on early acquisitions
“So, so we have a lot of hundred times returns or even a thousand times return, but most of them were small businesses.”
Östberg: European regulations place an unfair burden on local tech companies
“And they all make sense and they have good intention, but in collectively, it's just a big burden on, on, on those European companies. And I think a little bit unfairly that they are not the same criteria for other companies competing in Europe. So I think thi…”
Östberg: Chinese and US tech companies circumvent or ignore European regulation
“There's a lot of regulation that is circumvented or ignored by Chinese and US companies.”
Östberg: The European Union's Digital Markets Act is good regulation
“I think DMA is an example of good regulation.”
Östberg: Delivery Hero shares responsibility for Glovo's regulatory challenges
“I cannot blame Oscar for challenges that he is not responsible for that has affected him, but where we have collectively taken decisions that we think are right, then of course we also take shared responsibility on those topics.”
Östberg: Average companies deploying AI will benefit more than the Magnificent Seven
“I think Gen AI or the largest beneficiary of AI is, is going to be the average company deploying it and not necessarily the mag seven the ones who are building it. I think that is probably contrarian In this, at least if I look at the stock market, we will see…”
Östberg: Public AI narratives are cosmetic compared to actual operational efficiency
“If you have a story or not, that's a little bit Cosmetics. I don't care for that cosmetic so much. I care for actually leveraging and truly make our business better for it.”
Östberg: Amazon stock gains will come solely from business growth, not multiple expansion
“I'm still a big fan of Amazon, but of course the valuation of those companies have gone up a lot. So you cannot count on margin expansion or multiple expansion. Sorry. So, so the growth in those stocks will only be, or the value growth in those stocks would ba…”
Östberg: Drones could handle 25% of deliveries within 10 years
“It already reached a point where you can actually make it work economically. And in some places regulation is also a part of it. It will take time to scale it. But I think Over time, I know, 25% of delivery could be done by drones, but it might be 10 years, so…”