Grubhub, service that lets you order food for delivery or take out from local restaurants online, offers a compelling way to easily find restaurants and food in your city and order for delivery in minutes. While Grubhub offers its services to a number of larger cities (San Francisco, New York, Chicago, etc.), smaller cities and neighborhoods have not been able to access a similar platform that caters to their specific locales. Baltimore-based startup LocalUp is tackling the Grubhub model at a hyper-local level, offering food delivery platforms for small cities.
LocalUp lists menus from restaurants that deliver in a given city and allows diners to order carryout from these platforms. LocalUp actually creates a local, branded page for each city (i.e. Santa Barbara’s LocalUp site is branded as SBmenus.com). The service is free for diners and restaurants pay commissions on each order processed. Restaurants can also pay for advertising spots on the page, which place their menus in a more prominent area.
Currently, LocalUp is available in 30 markets, including Columbia, SC; Morgantown, WV; Gainesville, FL; Buffalo, NY; Boise, ID and Ann Arbor, MI. Since launching last year, the company has accumulated 500,000 users that have spent a collective $25 million on food delivery orders to over 700 restaurants. The bootstrapped company expects to grow revenue by 200 percent this year alone.
LocalUp differs slightly from GrubHub in that the company actually will license the white-label food delivery platform to local entrepreneurs, who then run the menu site. It’s sort of like a franchising model. The local entrepreneur is responsible for the day-to-day operations and LocalUp takes a cut from the total food delivery amounts made through the site. Co-founder Chris Jeffery tells me that this approach has helped the company scale without raising any funding.
Tackling the hyper-local market doesn’t necessarily ensure success as we know, but LocalUp could be on to something. The company has started to serve coupons and deals alongside the menus, which opens up another revenue stream. And the site could also be an attractive acquisition for GrubHub or Seamless.