The victims of the ‘gig economy’ are well publicised and obvious, from Uber drivers fighting tooth-and-nail to be given sick pay to those working their hearts out on insecure zero-hours contracts, so it’s hard to find a good news story. But now there’s one. Deliveroo is poised to pay its riders and drivers upto £10,000 each as the company floats on the London Stock Exchange!
As part of the £5bn floatation, making shares in Deliveroo available for the public to buy and sell, the company has promised to set aside a £16m pot to reward its drivers.
This will mean that the company’s very busiest drivers can expect a windfall of £10,000 each. The plan is part of founder Will Shu’s hope to reward some of the most vital people associated to the company.
The scheme will see riders in Deliveroo’s 12 markets, who must have worked for the firm for at least a year, receive bonuses of either £10,000, £1,000, £500 or £200, based on the number of deliveries they have undertaken.
And it's not just drivers who can benefit, customers will also be given the chance to get involved...
And it’s not just drivers who can benefit, customers will also be given the chance to get involved. Shu has explained
“Far too often normal people are locked out of initial public offerings and the only participants are the institutional investors.
“I wanted to give as many customers as possible the chance to become shareholders.”
To this end he plans to make £50m shares available to customers, who will be able to register their interest via the Deliveroo app. If there’s whopping demand for the shares then, again, it will be “loyal customers” who will find themselves at the front of the queue to purchase upto £1,000 in shares, with Shu saying he ideally wants to “make sure a mixture of new and existing customers benefit”.
Not that investing in Deliveroo is a guaranteed get-rich-quick scheme.
The company, founded in 2013, has yet to turn a profit. The most recent results for the year ending on 31st December 2019 posted a sharp increase in sales, up by 62%, at £771.7m.
Not that investing in Deliveroo is a guaranteed get-rich-quick scheme...
But the same snapshot also shows that the business’s pre-tax losses also grew, going from £243.3m in 2018 to £317.7m in 2019.
Of course these figures pre-date the pandemic, when it would be reasonable to assume sales shot up as people ordered their food in.
But the markets will now seize control of the company’s future, hopefully turning customer’s investments into gravy rather than scraps…