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Square Overlooks Rivalry to Bring DoorDash into the Fold

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Jun. 25 2019, Updated 10:51 a.m. ET

Square brings DoorDash to its restaurant platform

Square (SQ) has opened up its platform built specifically for restaurant businesses to its restaurant delivery competitors DoorDash and Postmates, mirroring a strategy that PayPal (PYPL) employed to convert its rivals into partners. After years of friction with payment card networks Visa (V) and MasterCard (MA), PayPal is now working with them to grow its payment business. For example, MasterCard is the card network behind PayPal’s Venmo debit card.

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Square announced early this month that restaurants can now accept orders from DoorDash and Postmates users directly on the Square for Restaurant platform, which is an advanced point-of-sale system designed specifically for restaurant businesses. According to Square, the integration with DoorDash and Postmates will streamline the process of accepting and managing orders, thereby helping restaurants to become more efficient and productive.

DoorDash competes with Square’s Caviar unit

DoorDash and Postmates operate services that allow people to order food from restaurants and have it delivered to them. Square runs a similar business under the Caviar brand, so on this front, it’s a competitor to DoorDash and Postmates. The others in this business are UberEats, a unit of ride-hailing company Uber Technologies (UBER), and GrubHub (GRUB), which bought Yelp’s (YELP) delivery business, Eat24, for almost $300 million two years ago.

DoorDash was the top restaurant delivery service in the US with a 32% market share in May, according to the latest market data from Second Measure. GrubHub came in second with a 31.7% market share.

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