Deliveroo is nothing more than a takeaway food app that hires a large army of Kamikaze motorcycle drivers at zero hour – Britpix / Alamy Stock Photo
The decline of London as a global financial center is the subject of endless pain. Ministers, regulators, entrepreneurs and outstanding business figures work together to find ways to stop the city’s seemingly endless decline – with few (if any) to show for their efforts.
Few people in the room were ready to acknowledge the number of stock markets that capital provides services, burning countless investors in the process.
Those who stayed out of the bag usually include individual retail shareholders who looked down on such reckless erosion of their wealth. However, the government seems to be really confused as to why there are very few people investing in the market.
Until the quality of the publicly publicized companies improves dramatically and consultants stop selling the prospect of often common stocks, the demise of London will continue. Those who hype do not raise the UK’s stance in the eyes of foreign or domestic investors. Instead, they just cause further damage.
With the company’s lightweight boards predictable, good obstacles are to get rid of short and disastrous work from the stock market, so it can be easily escaped from the easy way out. Accepting low-ball, opportunistic collection bids from U.S. rival Doordash is a clear admission that Driveroo’s brief time as a citation company was a huge failure.
Frankly, who can blame management for embracing any opportunity to escape the public market after such a tough experience? Investors listed four years ago snatched up Deliveroo’s stock, fooling themselves into thinking they were gaining one of the most promising technology pioneers in the UK.
Instead, they unconsciously supported one of London’s most popular companies. Among the stable fools of the city’s service, Deliveroo will surely bring the wooden spoon to the largest Omni Shambles in recent memory.
The company has so many prospects – even then-Prime Minister Rishi Sunak, shamefully, its shares are still trading at a third of the 390p floating point price before announcing Doordash after the market closed on Friday.
Indeed, apart from the shortest rally, Deliveroo’s stock price has never been mistaken for bad things that it suffered from the start.
According to data provider Dealogic, nearly £20 billion was removed from its initial market cap from the first day of the deal, leaving its listing price no more than 26% – the opening day performance made it the worst London debut in at least two decades. Even one of the company’s bankers has been cited because it is “the worst IPO in London’s history”.
The hustle and bustle among investors makes the big tug more visible to buy its big competitors, including Suitor Doordash. Its stock soared to 85% in its Wall Street debut four months ago.
This embedded content is not available in your region.
To some extent, the company benefits from beating its competitors through the position, and doing so faces less doubt on the extent to which it is largely a beneficiary of temporary lock-up lifts. It was a game against time when Deliveroo pressed the button, driving the float away before the third lockdown ended, bars and restaurants were quickly filled again, and purchase orders were dry up.
After a few weeks of delay, it almost certainly doesn’t seem to be so appetizing. Indeed, next month, its founder Will Schou also told shareholders that he was “happy” about the deal while warning about “the uncertain impact of Covid-19 restrictions.”
There are too many red flags that should be case studies to avoid what to avoid when investing in the stock market, especially its long history of failing to make money.
Even as government co-restrictions reached, a company known as one of the biggest lock-in champions lost £224 million. It explains why it was a business that made £1.3 billion of private capital in the following years, but sadly this does not justify the £7.5 billion indigestion valuation sought at Float.
Although it is one of the most popular delivery apps in the UK with 7.1 million active users, Deliveroo did not record its first annual pre-tax profit in 2024 until last year, the £12.2 million for a company that generated £20 billion in turnover.
There may be a reverse relationship between the number of meaningless rotations found in the company’s Float prospectus and the performance of its share. After all, it’s a boastful company that is “all about food,” “customer obsession” and “at the beginning of an exciting journey.”
Will Shu, founder of Deliveroo, warns investors about “uncertain impact of COVID-19 restrictions” in April 2021 – Aurelien Morissard/ip3
But then, its claim to great technical strength was always a marketing victory. Indeed, Deliveroo is far from the forefront of innovation beyond the 21st century, and not just a takeaway food app, hiring a army of Kamikaze drivers with a zero-hour contract.
Prospective investors should also spend longer to demand themselves to be the biggest winner in the IPO. As SHU’s shares unload about £26 million from the offset, their remaining shares are worth hundreds of billions of dollars, they have the right to doubt whether he benefits at their expense.
It’s perfectly appropriate if Doriveroo fell from Doordash to 180p per share – a complete 23% premium of 23% where its stock was last traded before the offer – Shu would make £172m in remaining shares for £172m, while many of Driveroo’s early backers would still take it, including 70,000 clients, including 70,000 customers who bought the stock.
What about the final farewell? Or is the fact that Goldman Sachs hosted the farce as one of the main listing consultants helping sell the company at a knock-down price?
Finally, it’s hard not to turn Deliveroo’s record into London’s lament – if the supposedly sophisticated investors find it difficult to value what a fairly immutable company is, then does the stock market seem to be locked in the death spiral?
Broaden your horizons with award-winning British journalism. Unlimited access to our award-winning website, exclusive apps, currency savings and more, free 1 month of telegram.
