The Stanford Football Disaster
Xu: DoorDash actually almost died after a Stanford football game in the fall of 2013. It was the first Saturday home game. After the game ended at an awkward time, everybody in Palo Alto decided to order DoorDash for restaurant delivery.
No one usually complains of too much demand — except when you have no ability to fulfill it. We couldn't shut off the website that kept receiving orders. We didn't have enough drivers on the road. Every delivery was at least an hour late, probably more like an hour and a half. It was terrible.
Everybody in Palo Alto ordered DoorDash at once. We couldn't shut off the website. Every delivery at least an hour late.
10 Seconds to Refund Everyone
Xu: At the time I could not raise any seed financing. Cash going to zero. Hundreds of customers very upset — they either received cold food or very late deliveries.
I remember that night, maybe 9 or 10 PM, my co-founders and I looking at what the refund cost would be. We thought the right thing to do would be to refund everybody. But that would take away about 40% of the bank account, which was already quite low. We took maybe 10 seconds to make the decision.
40% of the bank account. Already quite low. We took 10 seconds to decide. Refund everybody.
Cookies at 5 AM
Xu: We stayed up that night and baked cookies so that we could deliver them at around 5 AM, before everybody had woken up.
That was an early story that ultimately became the story that translated to our internal company value — customer obsessed, not competitor focused. The founding team always had this desire to do things the right way, even if we wouldn't have made it.
Baked cookies. Delivered at 5 AM. That became our value: customer obsessed, not competitor focused.
All You Need Is One Investor to Say Yes
Xu: Business was actually going really remarkable — organically, on its own, without the aid of marketing spend or discounts. Yet I couldn't raise a dime. I don't know what that says about my fundraising ability.
But all you need is one investor to say yes. And that's what happened. A couple weeks after the Stanford incident, we raised our seed financing.
Business was booming. Couldn't raise a dime. All you need is one investor to say yes.