We're going to look at how you can scale beyond food with a super app. Turning a food delivery platform into a super app. That's what we're going to look at because food delivery giants are really becoming daily life platforms. These super apps that everybody's talking about because while vertical, we're going to find out why vertical integration is key to margin growth and how AI, quick commerce, and the better finance are really shaping the next billion user apps, and of course how you can scale across 70 plus countries. That's the question that our next speaker can answer, and I'm really excited to see him once again. I was just in Munich at Bits & Pretzels, another startup conference in Europe, and it was absolutely fascinating that he was here. Now he's here in Dubai because he's not that often on stages. So therefore, it's also a huge honor to have him with us, the CEO of Delivery Hero, who co-founded Delivery Hero and turned it and scaled it from a startup into a 12.8 billion business with 30 major acquisitions. And he describes Delivery Hero as not just a food player but as a tech-powered infrastructure platform for commerce, logistics, and daily essentials. And he's going to be interviewed by the founding editor and chief of Wired UK. He's authored a best-selling book called No BS Innovation and spoken at over 700 events and has also invested in more than 180 startups including eight unicorns. So, please welcome with me now David Ron and Niklas Östberg. Welcome. Great to have you.
Anybody hungry? Do you want a schwarma, a biryani?
Or maybe you need some deodorant or maybe some toothpaste or maybe your weekly shop. This man can arrange it. He's got a couple of million riders in 70 countries around the world. And 50,000 employees making sure everything works. He doesn't just deliver food. He delivers whatever you want. Your weekly groceries, the item that you need in the next 10, 15 minutes. Delivery Hero is where it started. But now the company that our speaker runs is everywhere. Talabat which made its famous IPO last year is part of the group but also companies like Glovo, Delivery Hero, Foodpanda. But Delivery Hero is moving to the next level beyond just food to creating a single app where magic happens. Niklas Östberg, the co-founder and CEO of Delivery Hero, welcome. Tell us what a super app is. What's the difference between where you started helping us get our quick dinner and where you're going?
Oh, it started very nimble, I don't know, very small, but still very passionate about every single order in the beginning. That was all the way back to 2008. There were no laptops, there were no internet, Wi-Fi, all of that, and we were celebrating every single order. And we were only a marketplace for restaurants visible to consumers. Over time, we built out the logistic part. We realized that customers also want groceries. We also tried to perfect the experience by building our own kitchens, solve payment infrastructure, trying to solve for retail experience, and so on. We have built up from being just a food marketplace to being today more of a super app of anything you want. And yeah, that's where we are.
And you have previously said that the opportunity for the super app with quick commerce, with payment wallets, with groceries, is more than €200 billion. So I guess you are on the early stages of getting there. But how do you convert the user from being somebody who wants a quick snack to somebody who embeds Delivery Hero in their life?
Well, you have to deliver a good experience. So that's where it starts. And I think we built a very good food delivery experience first and people trusted us for doing that. And once we started with groceries and retail and gifting and so on, they also trusted us there and they gave it a try. And I think the only way we can do it successfully is that we wow the customers every time. And that's why we built up our own stores, warehouses, such that we can deliver, I don't know, hundreds of thousands of SKUs in a matter of minutes. And that's why customers trust us.
How do you think about the technology aspect of the platform? Because you call yourself a tech platform that enables delivery. Where does AI, where does the tech operation fit into the thinking around the business?
I think AI sits in every part of the business. Most people speak about the LLM part, the user interface, and so on. But if you look at our business, when you deliver more than 10 million orders per day, you kind of have to build a very strong technology platform. And as I said before, we're not a marketplace. We're a logistic company as well as building out retail capabilities. That means we have huge distribution centers with conveyor belts and packers and robotics, all of that, in order to deliver in minutes at a low cost to our consumers. So the whole technology as well as AI is to improve every single process to enable people to get what they want at a low cost.
Give some examples of specific ways you're using AI to improve the customer experience.
Well, so one is the user interface. So we have tried different ways of making contextual search, meaning that you search, 'I don't want to have peanuts' or 'I want to eat something that is spicy' and so on. We even built an example with Talabat where with shopping, you said 'I want to cook a tiramisu' or 'I want to do a chicken tikka masala, what do I need to order?' and it already places it in the basket. So we have done different experiments on how we can actually enable the consumer to get more. But again, I think the biggest user value that we're building is to enable low cost and a high degree of items available and that we know what you want as a customer. And that sounds very easy, but it also means that we have to deal with every single second that we can save is millions of savings that we can pass on to consumers. Enabling someone to order a food item for, I don't know, let's say five, six, seven euros and still getting it delivered and making it hot requires a lot of technology to know exactly where a rider needs to be at what point in time and how we can stack it with other items. Or if you want to have a grocery item, we need to make sure that we get the right grocery items into the right location for you to order, and again at a low cost, meaning that we have to have a certain number of items per square meter. Yeah. So there are so many examples where technology makes a difference for consumers in order driving cost, speed, and availability of items.
And I imagine you're building an incredibly detailed profile of user intentions by getting lots of data about my interactions as a customer. How can you use this data whilst respecting my privacy to get me more engaged, get me buying more, get me engaging for longer on the super app?
Yeah, we want to show what's relevant for you. So if you someone has a very good taste, you don't mind if it costs a little bit more, then we'll show restaurants that have the best quality close to you, restaurants that we think that you like or products that we think that you want. If I have a taste, I just want something cheap and fill my stomach, I will be able to find that too. I will find the best deals. I'll find the low cost items. I will find saver options for me because that might be what I look for. So a super app, making it, I don't know, the preference of it needs to be visible in the app when you get there that you need to see something that is attractive for you which might be different for me, and that's a challenge.
You're a global company but very active in the region here. People know Talabat well. How different is the business in the GCC region in the UAE and how has customer behavior varied compared to within Europe, within Asia?
So, Middle East is a fantastic market for us and there is a clear difference between markets. I think Middle East is very technology savvy. It values service. And our core belief was that we have to always deliver the best customer experience, and the best customer experience you get when local teams work in the market. So that's why we build a lot of local technology, local teams, local ownership, accountability. And I think that's what we've done so great in Middle East that you have Talabat is 100% focused on the Middle Eastern customer and a team in Latin America will be 100% focused on that Latin American customer which might be different. But I think this local approach and hiring strong engineering and talent pools locally makes a huge difference. It costs more but it makes a difference to consumers.
