Connecting hungry folk with takeaways is lucrative - but vulnerable
'We've seen just phenomenal growth," said Amanda Roche-Kelly, managing director of Just Eat Ireland.
The online takeaway ordering service, which started more than a decade ago, has just released half-year results which showed revenue jumped by 54pc in the first six months of the year, with orders and net profit up by a similar amount.
The London-listed company does not break out country-specific figures until the end of the year - but Roche-Kelly did say that Ireland has maintained its spot as the third biggest revenue-generating country of the 13 markets Just Eat operates in.
Like the wildly popular Hailo, Just Eat is one of a crowd of rapidly-growing online 'connectors' which are changing the way Irish people spend their wages. From taxis to cleaners, almost every industry now has a web-based connector ready to put customers in touch with sellers.
The businesses are defined by the fact that none of them actually manufacture the goods or provide the services that bring customers their way - but many are still making a fortune.
International companies have led the way. Ebay is the classic example; it has amassed annual revenue of $18bn and 35,000 employees through the business of connecting sellers and buyers. Ebay is a Californian company.
AirBnB, which connects people seeking accommodation with those wishing to rent it, similarly hails from Silicon Valley.
Taxi ordering app Hailo was founded in London by a former black cab driver, with Dublin its second ever market. Rival Uber is from the US and was huge in most North American cities before most Irish people had ever heard of it.
Kickstarter, the world's best known crowdfunding platform which connecting lenders with borrowers, started life in New York. Hassle, which allows people to search for and hire cleaners, was founded in the UK (though co-founder Jules Coleman is Irish).
But indigenous 'connectors' are making big strides too. The most developed are retail-oriented, Ireland's answers to Ebay. These include Dublin-based Adverts.ie and Wexford-owned Donedeal.ie. They are owned by Ireland's Distilled Media Group in partnership with the Oslo listed Schibsted Media Group, who also control Daft.ie. Then there is Buyandsell.ie, which started life as an advertising magazine before it was sold to Naldin, a company connected to Niall McFadden's Boundary Group, and later bought by Demirca, a subsidiary of Denis O'Brien's Communicorp.
In lending, Ireland's biggest new online connector, LinkedFinance, is also indigenous. Its founder, Peter O'Mahony, is the owner of the Laughter Lounge Comedy Club. KC Peaches and Leo Burdocks have both used the site to raise thousands from small-time Irish investors. Linked Finance allows the business to set the rate it is prepared to borrow at.
There are also Irish challengers to the might of Uber and Hailo. Lynk, which launched last October, was founded by Irish technology entrepreneur Noel Ebbs. It was developed for and aimed specifically at the Irish market with a fleet of 2,500 drivers. It is only available in Dublin for now.
There are more unusual indigenous connectors emerging too. One of these is the brainchild of Meath man Michael McKeon - IFindParts.com, a 'no find, no fee' website and app that helps people find used vehicle parts locally and quickly. Users begin by identifying their location, then specify what part they are looking for. McKeon's company sends out this information to the closest traders to the user, who have 20 minutes to respond. If not, the search goes out to the next 10 closest traders, until the whole network has been searched.
But just how sustainable is the business of connecting? After all, middlemen have always been more replaceable than the service providers or retailers they are connecting consumers with.
Multiple new competitors have emerged in the various markets Just Eat operates in over the past two years - and that includes Ireland. Roche-Kelly's predecessor James Galvin recently launched rival service Marvin.ie. Another new UK rival, Deliveroo, is also expanding aggressively in Just Eat's biggest market - the UK - having recently raised $70m. Deliveroo recently arrived in Ireland, so expect hot competition.
And there's the rub. Critics of the connector business model say the business of connecting people online is just too open, too easy to compete in.
Nick Batram, analyst at Peel Hunt, warned in the wake of the online company's results that Just Eat could come under threat because "the likes of Amazon and Uber are all coming in with slightly different business models".
"Ultimately, as the big boys move in, competition from alternative models increases. So there is potentially a risk to margins," he cautioned.
But Just Eat group chief executive David Buttress, who has led the company since January 2013, is confident his company will see off the rivals.
"It's always been a competitive place, there's nothing new in that," he said, noting that Just Eat had faced down challenges from Groupon, SeamlessWeb and lastminute.com over the past decade. American companies such as Amazon would have difficulty competing, Buttress argued, as "you need to have local teams in every market".
Being first to the plate certainly gives a huge advantage. JustEat now has 1,700 Irish restaurants on its books and it will take an awful lot of time for competitors to build up that kind of reach.
Ensuring it has good geographic coverage, as well as improving its website and customer experience, has until now taken up most of Just Eat Ireland's energy.
"We need to have options available in every location, so that wherever you are in Ireland, you can open the app and order," said Roche-Kelly. "We have almost total geographic spread now, which means our customers know they can rely on us."
Now, with a healthy base built, it is turning to marketing. "Our main focus for the second half of the year is brand investment," Roche-Kelly said.
A major marketing push is planned for the second six months of the year, starting with a flagship sponsorship of Electric Picnic in September followed by a television advertising campaign and its in-house restaurant awards, the Eaties.
Companies like Just Eat could also come under threat from the very industries they serve. What is stopping Ireland's restaurants from banding together to build their own online marketplace - with any profits funnelled back into their businesses, instead of squirrelled away to another company's investors? "The disrupters will be disrupted," predicted transportation expert Gabe Klein at urban transportation conference TranspoCamp in Washington DC earlier this year.
The taxi industry has already begun. Around the world, pioneering groups of cabbies are creating cabby-owned taxi cooperatives, sometimes with the help of unions, offering smartphone taxi hailing on top of a traditional service. An additional development is that in some US cities, politicians are taking on the task; several local authorities are developing city-wide ehailing apps as a kind of public utility.
The connectors have been warned.
Sunday Indo Business