As he writes in his memoirs, the story starts with an armpit.
In 2002, Mike Evans, co-founder of Grubhub, was a restless coder at a tech company who dreamed of finding a better—more seamless, you might say—way to order food, especially online. But he couldn’t find the motivation to actually do it.
“Lots of bus rides home, I’ve been thinking, Hey, maybe this time I’ll start coding up a delivery guide when I get home” he wrote in his new memoir, Hangry: A Startup Journeypublished November 1 by Legacy Lit.
“But each time that motivation has given way to reading a sci-fi novel, or playing Halo on XBox, or watching reruns of Buffy the Vampire Slayer“, he continued in the book.
Then, on a winter commute back home in Chicago, he fell, nose first, into a person whose armpit was decked out in “cool-fresh-evergreen deodorant,” he wrote, and it so annoyed and made him want to not cooking dinner. But he was also too irritable to order pizza. So Evans “opens[ed] my laptop and start[ed] coding.”
Twelve years later, Evans’ late-night venture, Grubhub.com, had merged with New York-based competitor Seamless, debuted at $26 a share on the New York Stock Exchange, and was valued at $2.04 billion, per Reuters. Contractor sat down with Evans ahead of the release of his book to discuss his wild journey from armpit to millionaire, his frustration with Grubhub’s current reliance on gig economy workers, and how he’s trying to make up for the mistakes of his current startup, gender – inclusive craftsman company Fixer.
The book flashes between Evans’ journey from Grubhub and the literal and emotional road to processing his experience there as he rode the 4,200-mile TransAm bike trail from Virginia to California.
But it also has a wealth of business insight. “The difference between not starting and starting is the hardest and biggest step,” Evans said Contractor. “It’s the biggest decision and the biggest factor in predicting success.”
How did Grubhub start?
After the armpit moment, Evans created a map of Chicago restaurants, restaurant names and phone numbers during an all-night coding session and Lucky Charms binge.
At the time, it had no delivery service — it was just an online list and map broken down by zip code, and Evans would sometimes scan and add menus after ordering from nearby restaurants using the list. Evans hated his job at the time – like listening-to-“I-quit” songs hated his job. So he decided the hobby delivery guide needed to make some money, get him off other people’s wages and maybe even help him pay off the $236,000 in student debt he and his wife Christine had accumulated.
Enter: friend and colleague Matt Maloney. Evans told Maloney about his idea to have restaurants pay to be listed at the top of the Grubhub website. Shortly after, Maloney left the office for a long lunch, talked to a Chinese restaurant owner and her bartender son about this newfangled online delivery guide, and they paid $140 to be “premium listed” on Grubhub.com for six months.
It was the first dollar the company earned. “A business is created with the first sale,” Evans wrote. “From this moment on, it’s a legitimate business, not a hobby.” But as he wrote in his memoirs, he was never really the face of that business. Maloney was, and he served as CEO from 2004 to 2021 under an agreement the pair struck when they raised money a few years in. (Maloney left the company in 2021, seven years after Evans did. Maloney is generally identified as the co-founder, but Evans refers to himself as the founder in the memoir.)
But before all that, they were just two men with an idea and a desire to promote Chicago restaurants. They—well, mostly Evans, he claims in the book—started by going door-to-door, restaurant-to-restaurant in Chicago and picking up menus to scan while trying to sell the businesses on paid advertising. It was a fast and furious business on foot – until Maloney had his breakthrough moment. “Why can’t we just charge the restaurants per order?” Maloney said. He even came up with a catchphrase: “You don’t make a dime unless you make a dollar.”
It worked. Despite the intensity of building a networked, subscription-based business from the ground up, Grubhub was indeed good for restaurants, at least as Evans tells it. That brought in orders, and Grubhub made a small commission on each sale. Evans taught himself to get restaurants on board, as he memorably recounts, to buy Sold for Dummies at Borders bookstore. Evans and Maloney eventually realized that ordering online was much easier for customers. After adding it, orders on the site tripled, and a month later, Grubhub pulled in $20,000 in revenue.
Going to success
This success led Evans to decide it was time to head to the capital of the startup nation, San Francisco, as the next city to add to the platform. In perhaps the book’s most memorable anecdote, Evans recounts criss-crossing the city of San Francisco picking up menus to add to Grubhub.com
In any marketplace business, Evans says, you have to find a way to set up your network. “My answer to that question is [to] cheating,” he says, like how Uber paid drivers to sit still until they got customers. “I had some crazy energy. It is not scalable. It’s not a particularly good idea.” But it drove traffic to the site, which helped him convince restaurants to take online orders and bring in more customers.
Evans hired someone named Tyler from Craigslist to be the business’s first employee in the area and sign on restaurants in San Francisco. Meanwhile, Evans and Maloney went to raise money, winning the University of Chicago’s New Venture Challenge and $50,000 in 2006, giving them the capital to bring Maloney full-time and access to the “startup Illuminati,” Evans wrote.
The pair used this network to find more investors, eventually signing what Evans joked in the book was the “worst investment deal ever signed” with Origin Ventures, which gave them $1 million for terms including what is called “participatory preferred investment ” (meaning they get a bigger piece of a company after it sells than in most venture deals).
It also came with another caveat: Evans could not be co-CEO, but embedded in the paperwork was the provision that Evans could leave the company if and when it sold, without a vesting period. “It allows me to work hard without ghosting to get it stuck,” he wrote. The terms were a little off, but there was cash. And it was time to grow.
Getting off the hook
And the business grew. Now, with the capital to buy Google ads and hire employees, Grubhub expanded to Boston, New York, Philadelphia and Washington DC, eventually entering 14 markets with just $3 million in outside capital. Early in that process, Evans wrote, he noticed a “get rich quick” culture beginning to develop among the company’s employees — a focus on enriching Grubhub at the expense of restaurants. Evans worked with the team to keep the focus on “making delivery better” and independent restaurants.
But Evans, whose stake in the company was 14% due to the initial venture agreement, also quickly lost the logistical power to decide what the company’s focus should be. In the fall of 2010, after years of slow, hard-won growth, Maloney and Evans began taking meetings with VCs like Sequoia and Benchmark and raised $31 million. “Nothing would ever be the same again,” Evans wrote, and he was right.
The company became profitable again after using only a third of that capital and began doubling every 10 months, Evans says, creating a big shiny goose egg for investors, all of whom want one thing — an IPO. “Greed. Greed happens,” he wrote.
After 2010, Grubhub acquired CampusFood, opened a shiny office in downtown Chicago, and merged with NYC-based competitor Seamless. Evans writes that they fought to limit the fees the restaurants paid the company to 17% and ultimately lost that battle. He also fought unsuccessfully to add Taco Bell or Pizza Hut to the platform and charge them less than independent restaurants for top spots.
The company was listed on the stock exchange in April 2014 after years of preparation. It added its own delivery network in 2015. Evans was pretty much spiritually out of the company at the time, he wrote. But he wasn’t proud of how the whole gig economy turned out, writing in his book that Grubhub became something it never wanted it to be: a “wildly exploitative” business that shaves off already thin restaurant margins and employs millions of contract workers who bike and drive around the United States without benefits or other job protections
He often argued in the book that the best way to keep customers coming back is to make it easier for restaurants to deliver a good product.
“The way to make the product better is to make sure customers get the best choice and the best food the fastest,” he says. Contractor. “The answer to that is, basically, not all of your drivers should be gig economy drivers. You want full-time employees driving a higher quality experience. It’s public blasphemy [market] rich. If I was on the Grubhub board and I said that, I wouldn’t be on the Grubhub board anymore.”
As for the transcontinental, post-Grubhub journey he also recounted in the book, there were moments where he lost control of the recumbent bike, flew down hills or got injured. It reflects the elements of losing control and burning out during his Grubhub journey.
He started the company because he hoped to pay off debt and find a way to fill his stomach more easily. Along the way, he rubbed shoulders with (and tripped up the noses of, as he described in the book) Goldman Sachs bankers and took an irreverent, almost manic approach to building a business on a shoestring budget before ultimately losing his battle against the suits. But he hopes, he said in the interview, not to repeat the mistakes he made in his Grubhub days.
And while Evans may have burned out on Grubhub, he hasn’t burned out on entrepreneurship. In 2017, he started Fixer, an on-demand handyperson service that also provides education and focuses on hiring for diversity. “Always learning, right?” he says. “I took a business from my apartment through the IPO, and I feel like I learn more the second time than the first time.”