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'For restaurants, they really have to be thinking about different revenue streams' Goldbelly CEO

Joe Ariel, Goldbelly CEO, joins Yahoo Finance Live to discuss the impact of COVID-19 on online food delivery, their growth in sales, and their new subscription service that helps vendors and frontline responders.

Video Transcript

MYLES UDLAND: All right, welcome back to "Yahoo Finance Live." Myles Udland here in New York. Well, in this time when we're all at home and probably ordering more food online than we ever have, if you're getting tired of the options in your area, Goldbelly is here to answer some of those problems for you. Joe Ariel is the CEO at Goldbelly, and he joins us now.

So, Joe, I guess kind of just outline for folks unfamiliar what your service is and where it fits into-- we'll get into the current moment, I guess, but just what Goldbelly is because some of our viewers probably have not heard of this.

JOE ARIEL: Sure. So the way we think about it is we are defining a new category called foodie commerce. And we empower about 500 food makers across the country-- restaurant owners, iconic food makers, small mom-and-pop shops who have signature regional dishes that they now can ship nationwide.

ANDY SERWER: Can I ask you [INAUDIBLE]? So do you have to-- I love it, man. It's just like the best pastrami sandwich or this and-- I mean, it's just amazing. But do you have to actually apply to get in to be a company that can sell, like it's got to rise to a certain level?

JOE ARIEL: Yeah. In the last year alone, for example, we've gotten 10,000 inbound requests from food makers. We work with about 500. So we have an industry hit list of places that we know have a ton of love out there that we are seeking, and then we also have inbound requests in which we try out new vendors and see what their product's like.

ANDY SERWER: So it's harder to get into than Harvard.

JOE ARIEL: That's what they say. We were actually part of Y Combinator, the Silicon Valley accelerator program. And they used to say the same thing, which is 1% acceptance rate. And we're a little bit lower than that.

JEN ROGERS: Hey, Joe. Yeah, even before we had you booked, last week I ordered. I didn't even know you were coming on.

JOE ARIEL: Thank you.

JEN ROGERS: We [INAUDIBLE] in Memphis for spring break last year, and so we were trapped in our house and reminiscing and thought we'd get some Central Barbecue. So I ordered it, and it arrived. And it was-- you also-- you know, you want to do something for these businesses. I want to know on your end though-- because we have talked to so many restaurateurs that are concerned that there's just going to be a washout of restaurants that don't make it. You're talking to these restaurants. How worried are you that a lot of restaurants are going to close?

JOE ARIEL: Yeah, it's a tough time, and I think there's a lot of things that are up in the air. How long will this go? Who the restaurant is, the brand that the restaurant has. But I think one thing is for certain. For restaurants, they really have to be thinking about different revenue streams and whether it's local takeout and delivery, bringing in reservations, and for us, like foodie commerce. The future is going to be diversified through a few of these different channels.

So we know it's a tough time, and as a team, you know, we're working double time right now to onboard many more partners. We get testimonials every day from some of our partners telling us things like this. This is from a shop in Chicago, Bartolini's Pizza. "As a family-owned and operated restaurant, our partnership with Goldbelly has afforded us the opportunity to keep all of our employees working during this unprecedented time. The best thing though is the friendships and amazing support of our new Goldbelly customers."

For some, they're saying that they're literally generating no sales except their shipping orders. We have a few shops in Texas that way. Pat Steaks, the iconic Philly cheesesteak shop, basically wrote us and said we're doing virtually no volume except for Goldbelly shipping orders. And I think last week alone they shipped out 12,000 cheesesteaks, somewhere around 40,000 for the month. Last month, Ess-a-Bagel and some of the New York bagel makers, more than 100,000 bagels shipped out.

So there's a surge in this demand, but we really feel, more than ever, that this revenue stream for a shop to all of the sudden have nationwide customers changes the dynamic for a mom-and-pop local shop.

AKIKO FUJITA: Joe, you mentioned the diversification in the revenue stream. One of the interesting conversations I've had with some restaurants is how they're looking at opportunities to upsell. So if you're a pizza chain, you're going to add the extra charge for extra cheese or extra sauce. I've talked to restaurants who are saying we're now doing a dessert menu for delivery. It's not a whole lot of revenue, but we're still going to get a little more than what we did before.

On your platform, what are you tweaking? How creative have you gotten to try and get more people to buy into some of your restaurants?

JOE ARIEL: Yeah, well, for some reason we're having the opposite situation where we have inbound requests from famous chefs, famous restaurants, mom and pops that are very well known that all of a sudden everybody wants to get on the platform. So we're moving as fast as we can basically onboard twice as many shops as we have in the past and also coach a lot of these guys how to ship their signature dishes, many of which are extremely perishable.

So for us, we're just trying to move faster. And for a lot of these chefs and restaurants we're working with, they may have been folks that, in the past, would be like, yeah, shipping nationwide maybe for the New York bagel guys and the Chicago pizza guys but not for us. But now we're literally seeing the top chefs in the country trying to figure out creative ways to ship a kit of their signature dish through us.

MYLES UDLAND: And Joe, just quickly, you know, you guys are launching a new program-- like a city subscription program is what you're calling it-- to help front-line responders. Just tell us a little bit about that.

JOE ARIEL: Sure. So we've always had requests of our customer base that said I'm from New York but I live in LA or San Francisco or Idaho. It would be wonderful if I could, every month, get a different shipment from my favorite city.

So we launched the program, but we launched it with a huge give-back component. For us, most of the revenue goes to the restaurant. The rest of it will go-- 100% of the net proceeds-- to first responders, health-care workers, delivery folks, people at UPS and FedEx and the truck drivers who are doing unbelievable work on the ground through these times in the form of Goldbelly care packages that we'll ship to the hospitals and to folks at their home.

MYLES UDLAND: All right, Joe Ariel is the CEO of Goldbelly. Great service, great program you guys got going, Joe. Several fans here on the program. Thanks for coming on. We'll talk to you soon.

JOE ARIEL: Thanks so much, guys.