DoorDash, riding on food delivery demand during the coronavirus crisis, looks set to raise hundreds of millions of dollars in new funding at a $15 billion valuation

• DoorDash is preparing to raise several hundred million dollars in new equity financing, The Wall Street Journal reported.
• The new financing would peg the company's valuation at $15 billion, up from $13 billion in November.
• The financing would push DoorDash's cash stockpile well above $1 billion — and would presumably push back its planned initial public offering.
• The company has seen a surge in sales and market share as a result of the coronavirus crisis.
• Visit Business Insider's homepage for more stories.

DoorDash is set to cash in from the coronavirus-spurred spike in its business.

The food delivery service is finalizing plans to sell several hundred million dollars worth of private company shares to mutual fund companies T. Rowe Price and Fidelity as well as other investors, The Wall Street Journal reported Thursday. Assuming the deal goes through, the new funding round would raise the company's valuation to $15 billion. That's up from the $13 billion value investors gave it in November.

A DoorDash representative declined comment on the report.

The new financing would seem to further postpone the company's planned initial public offering. DoorDash confidentially filed its IPO paperwork in February, but in early March, CEO Tony Xu indicated the company was in no hurry to go public.

Although it has consistently lost money in recent years — including an estimated $450 million loss on $1 billion in sales last year — Door Dash had $1 billion in cash on hand prior to the new funding, The Information said in a separate report. Meanwhile, the company expects to break even in the second quarter of this year, excluding certain costs, The Journal reported.

DoorDash and other food delivery services saw a surge in sales after state governments put in place lockdown orders to try to control the COVID-19 pandemic. With people largely prohibited from dining at restaurants, many ordered food online for delivery instead. In April, food delivery sales nearly doubled from the year earlier, according to market research firm Second Measure.

But DoorDash in particular saw gains. As of April, it controlled 45% of the food delivery market, up from 35% in November, Second Measure reported.

Got a tip about DoorDash or another startup? Contact this reporter via email at twolverton@businessinsider.com, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.

• Read more about DoorDash:
• DoorDash, buoyed by surging demand and ample capital, has launched new services like toilet paper deliveries from convenience stores during the COVID crisis. CEO Tony Xu says it's being 'extremely agile.'
• Tony Xu, the founder and CEO of $13 billion DoorDash, said the hardest funding round to raise was the first. Here's what he learned from the experience.
• DoorDash has expanded the places where it's offering free hand sanitizer and gloves to delivery workers — but doesn't see a nationwide rollout until the end of the week
• DoorDash stockpiled hand sanitizer and gloves for its delivery drivers, but it's only offering the supplies to a portion of them

SEE ALSO: A restaurant owner made hundreds by ordering his own pizzas through Doordash after discovering the platform had created a listing selling its pizzas for cheap

Join the conversation about this story »

NOW WATCH: Here's what it's like to travel during the coronavirus outbreak

https://ift.tt/3dVFr2C