Unless you spent last week living in a cave, you will know that DoorDash is set to acquire Instacart for $17 billion.

The deal, DoorDash's biggest yet, will, according to those involved, give the company greater scale as it expands beyond restaurant delivery into groceries and other retail categories, helping it take on big hitters like Walmart who have built sprawling store, warehouse and delivery networks.

Not everyone is a fan, however, with Peak Edge's Andrés Fournier arguing that this won't end well. In a LinkedIn post, he said: "What both companies have built at scale is remarkable and truly innovative. But after 15 years operating digital retail, dark stores, and supermarkets, both models have fundamental flaws. They are unfinished. Certain things have never made operational sense to me, and I wonder if the core unit economics will ever truly work for them."

He added: "First, marketplace commissions. Grocers run on 1% to 3% net margins. Giving up double-digit cuts (10%-30%) to third-party delivery has never made economic sense for retailers. Between the two, they raised over $8.5 billion in capital to subsidise this ecosystem, yet neither makes real profit on the delivery stream itself. Instacart’s only real margin comes from selling retail media ads to consumer brands, not fulfilling groceries. And funny enough, Doordash’s ads are still what pushes them over the finish line into true profitability. Instead of technology making food more efficient, convenience just stacked more fees onto the consumers and merchants."

Then there is fulfilment. Paying gig workers to push carts through crowded store aisles is the least efficient fulfillment model in retail, Fornier argues. "High error rates, wrong substitutions, slow picking, and zero floor density. Given those daily friction points, I've always wondered how much true customer loyalty they can ever build when consumers jump ship the minute a competitor drops a five-dollar coupon."

He stated: "Wall Street points to their moat: together, they are an undeniable behemoth in retail media ad dollars and subscription memberships. That part is true...for now. Because we’ve seen this movie across digital platforms before: as ad networks grow, inventory gets saturated, and the merchant’s ad dollar quickly dilutes into pennies of real return. Unless AI genuinely reinvents ad efficiency for brands, leaning on an ad tollbooth to subsidise broken logistics won't last forever. An ad model is not an operational moat, and it doesn't fix the math on the floor."

That brings up the bigger question. In an inflationary world where consumers will eventually hunt for value without limiting convenience expectations, high fee marketplaces are vulnerable. Seasoned industry players like Olo, who understand enterprise infrastructure, are introducing models that don't charge merchants fees and leave consumer data to the merchants.

Fournier concluded: "I truly believe it is not an "if" traditional fee heavy marketplaces get exposed, but "when." Will DoorDash be positioned to pivot when that shift hits, or does absorbing $17 billion of Instacart weight make them too heavy to turn?"

"I have great friends and respect for the team at DoorDash. I wish them the best, and we’ll find out if they finally crack the grocery puzzle, I'll be rooting for them. We’ll see what my take looks like in three years."

DoorDash did not respond to our request for comment.

2026 RTIH Innovation Awards

Grocery retail will be a key focus area at the 2026 RTIH Innovation Awards.

Check out our 2026 shortlists and finalists here.

The awards, which celebrate global retail technology innovation in a fast moving omnichannel world, have now closed for entries. Our winners will be revealed at the 2026 RTIH Innovation Awards Ceremony, taking place at The HAC in Central London on Wednesday, 4th November.

The event will consist of a drinks reception, three course meal, awards ceremony presided over by award winning stand-up comedian, presenter, actor and broadcaster, Aurie Styla, and after party until 1am.

Click here to book your place at the 2026 RTIH Innovation Awards Ceremony on Wednesday, 4th November.