Food delivery startup Deliveroo is feeling generous today. The company is handing out equity to all full-time staff members. In other words, 2,000 employees are going to receive the equivalent of $13.5 million in Deliveroo shares.
“Our phenomenal growth and success has been made possible thanks to the hard work, commitment and passion of the people who make this company what it is,” co-founder and CEO Will Shu told Reuters. “And that deserves recognition which is why I want all employees to be owners in Deliveroo and to have a real stake in the company’s future as we expand and grow.”
This is a great way to prove that you care about your employees. And yet, there are a few caveats.
First, the company is currently worth over $2 billion. In total, Deliveroo is just handing out 0.675 percent of the company to its employees. I’m sure plenty of early employees already have equity.
But those who joined more recently aren’t likely to get rich over this — it represents a $6,750 equity bonus per employee on average. And shares usually vest after a certain amount of time.
Second, this is the perfect example of the gig economy. In addition to the usual benefits, full-time employees are getting rewarded once again. If you’re a self-employed rider, Deliveroo doesn’t want to thank you.
Arguably, Deliveroo still thinks that riders are disposable. They might be the ones who pick up food in restaurants and hand it to customers, but they will never be full-time employees.
Sure, Deliveroo and Uber Eats are now providing free accident insurance coverage, but it mostly covers hospital bills. Riders have been asking for better rights, and this insurance package is just a good way to ease the pressure.
Working with contractors at scale is the backbone of Uber, Deliveroo and many other on-demand startups. This way, startups don’t have to pay the minimum wage or expensive benefits. Startups can also terminate their relationships with their ‘partners’ without any consequence.
It’s a great way to pressure your contractors in working more for less money. And today’s move by Deliveroo is further proof that riders are just an afterthought.