Ride-hailing to a restaurant is so January; swiping and tapping for delivery is the new normal. Therein lies the simple logic of the Uber Technologies play for Grubhub. It's panic shopping on a grand scale. It makes sense for Uber to ferry around takeout—rides were down 80% last month in the hardest-hit markets, and most restaurants still open are takeout-only. The question is whether the company should buy that capacity or build it? The funny thing is, Uber made the decision five years ago to build it, turning a small pilot program into Uber Eats, which did $2.5 billion in revenue last year. Now, it's angling to buy into food delivery as well, and it's not a great look, at least among antitrust regulators. David Cicilline, a U.S. representative from Rhode Island, called the bid "pandemic profiteering." To be sure, Uber CEO Dara Khosrowshahi has a reputation for shopping. In his 12 years at the helm of Expedia Group, he snapped up 41 companies with a collective value of $12.7 billion. Most notably, he forked over $1.6 billion for Orbitz and $3.9 billion for HomeAway, an Airbnb rival. Khosrowshahi, however, plays the equation both ways. At Uber recently, he sold operations in Russia and India for stakes in local ride-hailing companies perhaps better suited to serve the market. He also sold Jump, a scooter startup, to rival Lime in exchange for an investment stake. There are some simple decisions trees for any buy-or-build decision. Build the simple stuff; buy the complex. Build competitive advantage; buy commodities. Build when you have time; buy when you're in a rush. Build when the exercise will help parts of the core business. Often though, these choices are made on a far more ruthlessly: buy when you need to cancel a competitor (see: Facebook/Instagram). As ride-hailing swoons, food delivery is a natural move for Uber, but at the moment, it's still a terrible business. For every dollar in Eats revenue Uber gobbled up last year, it spent $1.55. There are synergies to be had in a Grubhub acquisition. The target has more of the market and far more restaurants on its platform, while Uber has more drivers and a better dispatching system. More importantly, a Grubhub deal would instantly give Uber about half the market, while at least a baker's dozen of rivals slug it out in the takeout hustle, chief among them DoorDash, which had an estimated 42% of the U.S. meal delivery game in March. Consolidation would certainly help the math work for Khosrowshahi, though there only so many levers it can pull. Restaurants and drivers already aren't thrilled about fees from third-party middlemen. With a nod to the hangry masses, some cities are limiting delivery fees, at least for a few months.Still, Uber is like the rest of us; it can't just sit around and starve.  Bloomberg Businessweek, May 18, 2020. Subscribe now. PHOTOGRAPHER: BRIAN GUIDO FOR BLOOMBERG BUSINESSWEEK | 
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