Good day, ladies and gentlemen, and welcome to the Prosus quick commerce deep dive call. All participants will be in listen-only mode. There will be an opportunity for you to ask questions later during the conference. If you should need assistance during the call, please signal an operator by pressing star and then zero. Please also note that this event is being recorded. I would now like to turn the conference over to Eoin Ryan. Please go ahead, sir. Great. Thanks, Chris, and good afternoon, everyone. Thanks for joining us today for the second call in a series of deep dive calls we're doing to help give a better understanding of our businesses and the key growth initiatives within them. Today we are moving to the food delivery segment and taking a deeper look at our initiatives in quick commerce. On the call with me today, I have our CEO of Food and EdTech, Larry Illg, and the CEO of iFood, Fabricio Bloisi. Larry will take us through the opportunity in quick commerce, and Fabricio will show how that opportunity hits the ground in Brazil. As is the norm, we'll go through a quick presentation and then we'll open it up for Q&A. With that, I'll turn it over to Larry. Larry. Thanks, Eoin, and hello, everyone. I look forward to talking to you today about food delivery and quick commerce. Let's hop in. Starting with slide two. We first invested in iFood in 2013 and crafted our global food thesis as we've helped management shape the company. That we are an operator of the business in this case and an investor in the case of our other positions is very important. We get the benefit of getting our hands dirty in operations and seeing the business up close at the elbow of iFood management. That gives us an edge when making new investment decisions in other markets. Similarly, as investors, we can see food delivery business models and all the variations unfold globally, and that makes us a better operator in Brazil. It's really the best of both worlds. Now, speaking of iFood, Fabricio, the CEO, will give an update on the company later in the session with a specific focus on quick commerce. Now in this slide itself, our footprint today covers leadership positions in restaurant food delivery in the vast majority of the over 60 countries where our businesses operate. Our platforms did over 4 billion orders in calendar year 2021. In 2021, we also expanded beyond core restaurant food delivery into central warehouse grocery with Oda and quick commerce with Flink. Now shifting to slide three. When we met at Investor Day in 2019, we discussed the evolution of the food delivery sector from 3P marketplace to 1P. From version 1.0 to 2.0 in this graphic. The most common questions were about the addressable market, investment requirements, and long-term margin profile of first party, as the model was largely unknown and unproven. There were also questions about right to play from leading marketplaces. We made the investment in 1P and iFood out of the belief in superior consumer experience and the dramatic expansion of the addressable market. Fabricio will touch on this later, but we were methodical and disciplined in our rollout of 1P, and the good results. We've been careful in our investment decisions. In the three years since we rolled out at iFood, we have extended our leadership position and rolled out 1P where it makes sense, in roughly one quarter of the city where iFood operates. We've brought the aggregate food delivery business to profitability in the process. Worth noting that we've also expanded the 3P footprint for iFood in this period. We continue to be agnostic to business model and focused on consumer experience to unlock market potential. Now, as the food sector evolves further into food 3.0 and quick commerce, we're getting many of the same questions and following the same approach when we moved from 1.0 to 2.0. We believe there is a meaningful market opportunity in quick commerce and believe in restaurant food delivery platforms' right to play. We will bring the same discipline to addressing the opportunity as we always have. Now, shifting to slide four, what is quick commerce? Quick commerce is a term that's being used for the delivery of a mid-size selection of 2,000-3,000 SKUs in 10-20 minutes. Quick commerce addresses many use cases. There's a traditional convenience shopping trip that would involve milk, butter, soda, or candy. It's a trip that many on this call would have done in the offline world through your local convenience store. There are occasions whose primary purposes are more closely aligned with meal occasions, be it ready-to-eat foods or delivering fresh ingredients to complete a recipe. From a platform perspective, it's often hard to make sense of an individual customer basket as it can be filling in a variety of needs that do not warrant a trip to the grocery store. Same with restaurant food delivery, we are agnostic to the business model. In some cases, we will use a marketplace. In others, dark stores with own inventory will be superior. We'll continue to be analytical and methodical in our rollout here. Now to slide five. One of the questions we get most often is about the assortment that is available on quick commerce platforms. While the specific SKUs vary according to local market dynamics and consumer needs, the broader principles hold. Here you see an example of Flink and how they get to their typical basket. We invested in Flink in part because of the thoughtful and highly disciplined approach Oliver and his team brought to consumers in markets that we felt were underserved by food delivery platforms. We've met with dozens of quick commerce companies across the globe and made just one investment. Everywhere else, we have focused on organic builds on the back of our restaurant food delivery platforms. Let me go back to the Flink basket as an illustration. Compared to other markets, Flink's version of quick commerce will have a heavier emphasis on fresh goods. In many other geographies, you'll see a more traditional convenience store inventory that focuses on snack foods, soda, and alcohol. In some markets where water is not always safe to drink out of a faucet, we see bottled water take meaningful share. In a market like India, you expect to see greater emphasis on chilled dairy. You'll notice on the slide that the average order for Flink is over $28. This is much larger than you might observe in other markets. It's also growing nicely. In Germany, for example, the average order value has grown almost 20% in just the last six months. One thing powering this growth in order value is ready-to-eat meals. I'll touch on the strategic value of ready meals in a moment, but Flink has established an exclusive partnership with EAT HAPPY sushi, among other ready-to-eat meal providers. EAT HAPPY is the market leader in Germany, present in two of the biggest grocery chains, and now available in 80% of Flink hubs. Moving on to slide six. I often get a question about addressable market and how big this can be. The closest offline analogy we have to online quick commerce is your corner convenience store. It's far from perfect as a comparison, as quick commerce can cover other areas of retail like grocery, pharmacy, pet food, et cetera. While not perfect, it's useful to give an indication of TAM. The narrowest view of the online opportunity would be that it can capture roughly 10% of the offline convenience store activity. That would point to a roughly $50 billion opportunity on the low end. As evidenced by the Flink example, the category is much broader than your corner 7-Eleven and can attack more meaningful revenue pools in broader grocery. It's worth noting that convenience offline is the most profitable area of grocery retail. We are playing in a meaningful revenue and profit pool. We'll cover this in greater detail, but our restaurant food delivery businesses have a very strong right to play here. Moving on to slide seven. Many of you have heard me say previously that food delivery had some of the best consumer cohorts and NPS we had ever seen. These are even better. Consumers love the product offering. Now, the natural reaction is that, of course, consumers love when you deliver merchandise at a loss and do it quickly. That's where we've been especially careful. We've not invested in companies whose sole value proposition lies in discounts. Yes, price is a factor in quick commerce, but we emphasize selection, quality, and convenience, and find that our core food delivery customers are willing to pay for those. Shifting to slide eight. While we don't play in the U.S., this chart shows a pretty good example of why food delivery companies are paying attention to quick commerce. There's a very high degree of consumer overlap. Consumers who are willing to pay for convenience are willing to pay for it in all of its forms. Even as just a defensive measure, restaurant food delivery companies have to address the quick commerce space, or they run the risk of disruption. Just as 1P-native food delivery companies have taken share from 3P, the same can be true here. To make that more tangible, recall the sushi example for Flink. A sushi meal occasion on Flink could have easily been a sushi meal occasion on a restaurant food delivery platform. Not just fear of disruption, restaurant food delivery companies have a very strong right to play in quick commerce. Where many native quick commerce companies are spending billions of dollars on customer acquisition in an effort to identify the good customers in a sea of discount hunters, food delivery companies already have a good sense of who the good customers are. They have already been acquired, and loyal behavior has been established. In that case, it really is just a matter of cross-selling through your existing product and introducing it to an existing loyal customer base. Now to slide nine. One of the most common questions I get asked is about the operational complexity and specifically about the promise of 10- 15 minute delivery. It seems too good to be true. The reality is that the build-out of quick commerce is far easier than the journey we went on from Food 1.0 to 2.0, from third-party food delivery to 1P. On that journey, we had to turn third-party marketplaces like iFood from a marketing and pricing focus to an operations and logistics focus. These businesses had to be completely retooled. Some marketplace operators and their investors had to learn this the hard way. Why is quick commerce easier? I find the graphics on slide nine a helpful illustration. On the left-hand graphic, go back to the early 2000s and when 3P food delivery was king. There, marketplace platforms served as marketing engines and sent consumer leads to a restaurant. The restaurant's own drivers delivered the food in a hub-and-spoke fashion, picking up the food from a known restaurant and delivering it in a defined, well-known neighborhood. The middle graphic points to the complexity of 1P. In that context, a delivery driver could start at a pizza restaurant, go to one house, then have to figure out where to park and pick up the food at a sushi restaurant, then go to a different house, potentially in an adjacent neighborhood, and then on to a taco shop. It's a very challenging logistics problem to solve, especially given the perishable nature of inventory. Batching orders to save costs is a real challenge. By comparison, quick commerce, the graphic on the right by a dark store is much closer from a logistics standpoint to third-party food delivery. There you are sending a driver from a perfectly designed starting point, a store you designed and optimized for picking time. The driver executes in a hub-and-spoke fashion, traveling a neighborhood they know very well, back and forth. It's simpler, and you can get efficiencies in order batching that are harder in a 1P restaurant food delivery model. Further, you can be very thoughtful in where you place the store when it comes to dark stores. Ideally, you are placing the dark store in the middle of an area where your best consumers live, in an area of high density. It will not be expensive main street retail, but perhaps less expensive neighborhood warehouse locations where the site selection optimizes price versus delivery times. Now going back to the promise of 10-15 minutes. The optimal end game is where you charge a premium to deliver in this timeframe, and consumers can opt to pay. For many orders, consumers will be indifferent between 10 and 30 minutes. The latter allows you to optimize for batching and delivery costs versus speed. Moving to slide 10 and talking a little bit about profitability. We've looked at pretty much every investment opportunity in the quick commerce space globally. I believe we have an unparalleled view on the sector and how it's evolving. It's a generalization, but we typically see the model breaking even at the store level at around 500 orders per day. Competitive dynamics, inventory mix will matter, but generally 500 is a good number. While the space is still early, we've seen stores get to much higher numbers, in excess of 1,000 orders per day in certain cases, and deliver strong store-level profitability. Back to Flink, their top 20 most mature stores are already doing 560 orders a day on average, and as mentioned, they are growing order value as well. We have conviction that this opportunity will be large and profitable. You might ask, "Well, why aren't we seeing the profitability now?" The short version is that we have many of the stores on the left of the curve on this chart. The financial picture that you might see is the sum of all of our stores. We're getting all the early pay now, spending the CapEx and working capital against lower order volumes and working our way up the curve. Now to slide eleven. More on profitability. As we looked at our operators around the world, we have found that they are taking many logical steps to improve profitability. In the interest of time, I won't go through the laundry list here, but just a few examples worth calling out. As I mentioned earlier, Flink's increased AOV in Germany by nearly 20% in six months. Many of the operators we see are focused on building direct supply agreements, and some have white label approaching 20% of sales at nearly 50% gross margins. In a number of markets, delivery fees and advertising are already being implemented. We're taking a sober and disciplined approach to building and working our way up the curve with a focus on serving customers in a fashion that is sustainable economically long term. Now to the last of my slides, slide 12. Our leading food delivery companies are pursuing this opportunity across their footprints. As we were in the build-out of 1P, we are not seeking scale for scale's sake. Rather, we are seeking to serve our consumers well and in an economically efficient fashion. We are being methodical and disciplined in our approach. Delivery Hero identified the opportunity here early and has been quite thoughtful in how to build out their quick commerce footprint. While this model arrived relatively late in India versus the rest of the world, Swiggy is a market leader, and Instamart is our competitive differentiator. It's important to remember that this is still a local game. Some efficiencies in inventory acquisition and branding come with a big national presence, but this model does not need to be big at a national level to work. Local scale and density matter, and that is our focus. Fabricio will cover in more depth, but iFood addressed the broader grocery opportunity first through their grocery marketplace and is now specifically addressing quick commerce. I'll hand over to Fabricio to tell more. Fabricio, over to you. Thank you, Larry. Good afternoon, everyone. Good morning, everyone. Good afternoon. I am Fabricio. I'm the founder of Movile and partner of Prosus for many, many years, more than 10 years since Prosus invested in Movile. I am the CEO of iFood, a company we built together over the last few years. Just introducing iFood and myself. If you go to slide 14, hope you have my slides. iFood have been growing now a lot over the last few years. You can see here the last number, last yearly number we made public. We've grown a lot over the last few years, but more than quick growth, iFood became a part of Brazilian life. It's not only a food delivery company, it's one of the biggest e-commerce company, one of the biggest and more innovative internet companies of Brazil. You can see here on the right, iFood brand in Copacabana Beach or in the skies of São Paulo with drones or even pushing how we believe that the best companies in the world will lead through a strong ESG push, contributing to the society. iFood today is part of life of 40 million unique buyers over the last one year. Around 298,000 active restaurants and transacting tens of billions of reais per year. Talking about the iFood journey, as Larry said in his first slides, we were a 3P player just like four or five years ago. Four years ago, we decided to become strong in 1P. This was the big subject in this kind of call two or three years ago. Can a 3P player become 1P? Is it going to be profitable? The very good news is that our 1P transition were very well. Today, we deliver 1/3 of our orders. It's already a profitable business unit, and it's growing. It was very important for us to invest in 1P as a transformative trend that we saw in the market. When you talk about iFood, we're talking about first a 3P player, then a 1P player. We keep transforming ourselves, and grocery is the transformation thesis for last year and this year. If you move to slide 15, you can see what was our focus last year. We decided to go fast on groceries, and we started investing in grocery marketplace. In one year, we grew from BRL 150 million to BRL 400 million per month in grocery sales, together with many first-class partners as Carrefour, GPA, many grocery stores. We enabled tens of thousands of merchants to sell grocery through the iFood platform. In just one year doing grocery as a priority, we became one of the top 10 biggest grocery players in Brazil, and we are still starting. I'm sure we are going to keep growing a lot. The nice thing to tell you today is that this is a journey, and as grocery marketplace was our as 1P was our bet three years ago, grocery marketplace last year, our bet today is quick commerce, and we are quite confident on what we have. If you go to slide 16, you can see that we just started quick commerce by July last year, so a little more than six months ago with the first stores. Right now we have 62 stores making a promise to deliver in 15 minutes. You can see here on the right some pictures of some store in Rio de Janeiro. I'm sure this is just the start of our journey, and we are going to keep growing this store base substantially, and I'm going to tell you why in the next slides. If you go to slide 17, you can see a little of our performance over the last seven months. We have two or three other competitors in the market. We were late to enter in the quick commerce, meaning this 10-minute, 15-minute delivery. In August, we have just around 10% of market share. In February, just seven months later, we have around 40% market share. We are growing fast, and we are just beginning to see our growth. The reason that make me excited is not only the left chart in the slide 17, but the right chart that shows we are just in 20 cities today in the quick commerce offer, when the iFood grocery marketplace is in 1,200 cities, and the whole iFood is in 1,700 cities. For sure, we are using data and AI to select the best places, the best cities where we can make an offer that is the customer demands, but also that has good economics. The good news is that we have a lot of space to grow, a lot of demand to understand what the user need and to offer new quick commerce stores. I think we are growing, we are growing well, and I think we have a lot of space to grow ahead. Our current focus is to get to 50 cities, and then we will stop again and check how much we should invest and where we should grow on quick commerce. Why I believe quick commerce is important, if you go to slide 18, you see a little about that. The retention we have when we do a quick commerce offer, like a dark store delivering, we promise 15 minutes, is very high. You can see on the left of the slide 18 that we have around 81% retention. Also the frequency we have on that is very high, around 10 transactions per month. Just for comparison, you can see here, like the regular grocery, we have a smaller retention, a smaller frequency. Many people ask to me, and probably this is going to be one Q&A answer, "What's the right model? Is it like only food? Is it quick commerce or grocery marketplace?" I don't think this question makes sense. I think we have a market which include grocery of hundreds of billions of dollars, and we need many different solutions for different customers. I have clear demand for food delivery, clear demand for grocery, and clear demand for quick commerce from my best customers. The customer that like more iFood, that order more often, they have a clear demand for this product. At the same time, a leading food delivery player like us offering quick commerce enables us to cross-sell to our best customers and supply to them what they want from us. At the same time, it's also a defensive move because if we don't offer that or we are slow in growing that, some people can offer this to my best customers. For us, doing that very well is very important to make iFood bigger and better for our customers. If you go to slide 19, you can see a little more about that. We started with a promise of 15 minutes delivery, and there was a lot of questioning. I think the big question is it possible to deliver in 15 minutes, then how is the economics of that? That's what I want to tell you the next few slides. In just six months, our average delivery time today is 10.5 minutes in February, and hopefully it's going to go a little smaller. I'm quite excited about that. What we have here is a wow effect from our customer. The customer that can order bread or a drink or something and receive in 10 minutes, they think, "I trust in this platform. I trust in receiving what I need quite fast." They get a very high level of fidelization frequency because of this great experience. To highlight the second point, that is breakage, how many things in the order is missing or we have to change the item, and we are doing just 1.5% of breakage in our delivery. This is very important to highlight because when I do marketplace, although I have a 1,200 seats coverage with many partners that are very good for bigger shop baskets. The breakage used to be much higher, around 10 x higher, to be honest. When I can offer a service that can deliver in 10 minutes with a very high quality in terms of the low breakage, we have a very happy customer that completely believes the brand and wants to buy more and more often. You can see the result at the far right with a very high NPS of around 70. Many people ask, "Does people have these demands?" My answer is a clear yes. Where we offer that to our customers, they have the demand. The experience is clearly more sophisticated with a quick delivery and low breakage. What I believe is that we're going to see a lot of growth on that over the next two, three years of growth. It's important to highlight we entered this business just seven, eight months ago, so we are still early stage. We don't have a mature offer yet. We are going to expand in cities and even operating systems. The journey for the customer and to expand what iFood is makes complete sense and this is going to be important part of the iFood service. I was talking about slide 19. If you go to slide 20, I'm sure there will be some question about that, how I see profitability and economics of this business. Today, we do on average 220 orders in our stores. This number doesn't tell very much because many of these stores are just, like, three or four months old. I just have a few that is six or seven months old. With some of our older stores, older means seven months in this case, we are already at 500 orders per day. What we see at scale is every store on average is going to do around 600 deliveries per day. As Larry said, at this scale, we believe it's going to be a profitable and good business. I just want to remind you, many people was questioning, is 1P something that's going to be profitable someday? Today, 1P is critical to our growth and to our service, and it's a profitable business. I think this is going to go to the same journey, and it's going to be more mature in, let's say, around 1.5-2 years. What we see is a path to increase AOV. As users buy more often, they tend to buy more things and to have a bigger basket. What we believe that at scale, you have a bigger basket. Today, many of our offers has free delivery or very cheap delivery. With time, we are going to start to charge around BRL 8-BRL 10, and that's what we believe the customers can pay. That's what they pay today, BRL 7-BRL 8 in food. We are not charging it today because it's a very new service we introduced just six months ago, so it's time to let people experience it for the first year and then increase the delivery fee. We have the highest demand we always saw in terms of ads. Many players, partners, for example, big company that sell products to the end user, grocery products, they really want to advertise through our quick commerce stores. Today, we are doing 1.5% of the GMV in ads. We put here more than 3%. I can see a scenario of 4% of the GMV in ads, and this will improve substantially the profitability of this business. It's not my focus today to be profitable on these stores, but it will be in 1.5 years. The data we have today, we think this is going to happen. Just want to remind you, the iFood team has made many cycles over the last few years. As I said, the 3P, then 1P, Marketplace and now Quick Commerce. We have some experience in starting a new service, losing some money in the beginning, scale it, optimize the economics, and make it profitable after two, three, or four years. We are not a company with the mindset of, let's just, invest, too much money and see what happens. I'm quite confident that this is a quite good case to have a good product and with good economics in two years. Just as the last slides, hope you have questions that we can answer. We started today with seven stores. This is small compared to what you saw with Swiggy and Delivery Hero, but we grow 10 x in seven months. We are going to expand using iFood data during this year, so it means we know the customer, we know where they live, we know who wants to have better service of receiving items in 10-15 minutes. We are using this data in our existing customer base to scale that to 2022. Our expectation is that we have the demand in Brazil to have more than 300 stores, and we are going to keep growing to around that number. To be honest, my goal is not to have a specific number or to spend and just measure how much we are spending, but to really understand where there is this demand, where I can deliver, where I have high frequency and a good customer experience requiring this service. That's where I believe we will be by next year expanding Quick Commerce. I'm quite confident that this is a good direction, and hope I can, after this introduction, answer some of your questions. Thank you, Larry and Eoin, and hope to answer questions from everyone. Thank you very much. Okay, go ahead. Thank you, sir. Ladies and gentlemen, if you wish to ask a question, please press star and then one on your touch-tone phone or on the keypad on your screen. You will hear a confirmation tone that you have joined the queue. If you wish to withdraw your question, please press star and then two to remove yourself from the queue. Our first question is from Lisa Yang of Goldman Sachs. Please go ahead. Hello. Thank you very much for taking the questions. Very interesting presentation. My first question is quite general. I mean, we've seen Instacart last week, they marked down their valuation by 40% to reflect obviously the reality of the market, but also to attract talent. I'm just wondering, like, how does that move make you think about, you know, the valuation of your company? Is that something that you'd be willing to do? That's the first question. The second one is on Brazil more specifically. Obviously, Uber has, I think, left the market recently. I'm just wondering, have you seen any major benefit from that exit? Like where are you in terms of market share right now? What does that mean in terms of profitability for the business? Also how much you can potentially reinvest behind that quick commerce initiative, and where do you see the profitability in the next two years? The third question is on the quick commerce business. Could you maybe give us any sort of color in terms of where do you think the EBITDA to GMV margin could be achievable in the dark stores longer term? What's the merchandise margin as well, pre and post-promotions? Thank you. Thanks for the question, Lisa. Why don't I start, and then I'll hand over to Fabricio to give some color on what he's seeing on the ground in Brazil. On the Instacart part, to be honest, I don't have a lot sensible to say here 'cause we don't. While we observe the U.S. market, we don't operate locally, even though I'm based personally in the U.S. I think the interesting thing about the announcement is how I suspect as an outsider, they're seeing some of the same crossover from grocery to quick commerce to restaurant food delivery. Frankly, it speaks to consumers that are agnostic to platforms' own business models. They just want what they want when they want it. That was one of my takeaways from their announcement. On Brazil specifically, I'll hand that question off to Fabricio to talk about, you know, what he's seeing in the market from a competitive standpoint. My lens on that, operations in Brazil is that we've always been focused on building our own company and satisfying our own consumer needs. While obviously we have an eye towards competition, for us, it's really about, you know, our story starts and ends with the consumer experience. Competitors come in and out over the years, or they change their business model, but ultimately, our story will be told by how we operate. On margins globally and what we see for quick commerce, you know, obviously the story is still unfolding real-time, but my expectation is that we'll see EBITDA margins for the sector. You know, I guess it depends on your profitability lens. If, you know, I think the standard lens that people seem to be gravitating to is, you know, EBITDA as a percentage of GMV. It's probably gonna end up somewhere north of 5%, but below 10%. You know, not all that inconsistent with what we've seen of the hybrid models in restaurant food delivery. Fabricio, do you wanna offer any other color on what you're seeing locally in Brazil from a competitive standpoint? Hello, Lisa. You made three-part questions, so on Instacart, very fast. We are so much more focused here in operating the business. I believe we are in a 10-20 years transition or wave where people are going to order much more foods and then groceries and other products at home. We are much less spending time with the current market oscillation and focusing keep growing. I think we have so much to grow. We are not focusing in this valuation, or we don't have any comments on that. Uber left market. I'm quite happy that iFood has the very best relation with the customer, with the restaurant, with the delivery, not only comparing to all the players here. I think we already have a quite high market share. I think Uber leaving is not going to change dramatically our market share or our growth because we already have all this big position today. The margins, what could be achieved, are like the 5% that Larry Illg just said, but I think it's too early to say a specific number. I think we have about one, two years to get much more scale, but I'm confident it's going to be a good business after, let's say, two years. Thank you. The next question is from Miriam Josiah of Morgan Stanley. Please go ahead. Great. Thanks for the presentation. Three questions from me. Just firstly, just wanted to get a better understanding of how you're thinking about inflation, the environment that we're seeing at the moment and the impact on consumer behavior here. I mean, on the one hand, I guess it is a grocery category, which you would expect to be pretty resilient, but then this is slightly more convenience-driven than your typical grocery shop. So how are you thinking through consumer sensitivity to pricing and delivery fees? Do you think that the assortment is wide enough to facilitate trading down from the consumer? Anything you can share on that would be great. Then, secondly, I guess we've seen a lot of platforms now perhaps shifting away from just focusing on 10 minutes to 30 minutes to 1 hour delivery. Could you just talk about any plans you may have to address larger baskets and potentially looking at same-day delivery as the endpoint rather than just quick commerce? How important is that less than 15-minute delivery time? And if you do plan to address larger baskets, how do you need to adapt the model, to do that? And then finally, you mentioned the need for food delivery platforms to address grocery. How are you thinking about the reverse for standalone platforms like Flink? Do they need to get into food delivery? Are there any plans already to do this? Thanks. I can take those. To your first question on inflation, obviously that's one of the big themes of the day in, you know, I think to the surprise of nobody, we're seeing that start with fuel prices, which is, you know, one of the obviously an important input cost for our drivers, as well as just wage costs increasing. That's something we're seeing in many of the markets we operate around the globe. To your... I think you touched on some of it in asking the question. We find that, you know, grocery is resilient and specifically in this context with quick commerce, but also with restaurant food delivery, we find that a convenience-minded customer is willing and able to pay for that convenience. We haven't really seen, you know, meaningful impact in how our consumers are consuming the product and the frequency they're ordering and willingness to pay thus far. Time will tell. On your second question, on delivery time and the how important 10-30 minutes is, I think especially the popular press has gotten fixated on 10 minutes, and they're running jokes about, you know, somebody's gonna go to nine and then eight. There are very few use cases where 10 minutes is vital, and I think where the sector evolves is for those cases where somebody absolutely needs something in 10 minutes, there will be a willingness to pay for it. You will see platforms increasingly charge for it. Otherwise there's not a lot of difference between 10 minutes and 20 and 30 for most consumer use cases. So I think there's a focus on timing, and that's some of the analytic work that our teams are doing, is to figure out, you know, what is the real consumer sensitivity as indicated by their willingness to pay for that kind of speed. And then to your last question on the need for food companies and grocery companies to consider food. I think this is where I find the Flink example, and we've seen this on other platforms with ready-to-eat, you know, coming into play. You know, the meal occasion. Some of the meal occasions that we're seeing on quick commerce platforms, I mentioned the Flink sushi example, that could have been a restaurant food delivery offering, you know, from one of the leading platforms in the same markets they operate, but it happened to come through Flink. I think there's a lesson here, broadly speaking, about the consumer internet, where your consumers, the moment you fall in love with your business model over what consumer needs and the need that you're filling, you create a competitive opening for somebody to serve your best customers. In our case, you know, what we're seeing across the world is the lines are blurring between what is a native restaurant food delivery company, a quick commerce company, and a grocery company. I think you're gonna see different variants of this play out across the world, across the different, inventory mixes and business models. Hope that answers your question. Hey, I think it's Mary. Let's try to complementally give some more color on what Larry said. Your first question is great about inflation and how is the impact on that. Just want to remember, not only food inflation, but wage inflation, gas inflation. Delivery partners also spend on gas. The pressure on inflation is high, very high, and it is something that we really can sense from all the customers. I want to remind you, we are in the middle of a secular transition. People are going to opt to order more food delivery and grocery delivery and delivery of regular items. What I think today is that we'll w e may have a smaller growth rate due to this inflationary pressure, but how we are handling that, putting an enormous focus in optimizing costs and trying to manage prices in a way that we can deliver the best price for the customers. Specifically, for example, in grocery and in larger baskets, the customer really needs the best price possible, and we have this offer also inside iFood because the demand for that was never higher. I don't think this is an iFood thing, not a Brazilian thing. This is a global problem today. We will have to optimize the platforms to deliver the best for the customer in terms of price. Your second question is about 10 minutes to 30 to full day. Remember that we are exactly the opposite. We started doing grocery in a full day or next day delivery. Our grocery marketplace started doing full day, next day. We reduced it to 30 to one hour. We offered, in the last six months, the 15 minutes through quick commerce. Today, we have the full offer. We don't do 10 minutes officially today. We promise 15 and 30 and 1 hour and next day. I think, again, I said that when I was talking, people ask, "What's the right model?" Not a question of the right model you have to have. We are talking about a country in the size of Brazil. You. Some people can pay for a 10, 15 minutes delivery. Some people want to wait for next day and get a higher basket with a smaller price. We have to offer everything. I think we start with the next day and going to the 15 minutes creates a very good portfolio for our customers today. Thank you very much, sir. The next question is from Christopher Johnen of HSBC. Please go ahead. Yeah, thanks guys for taking my questions. So first, I would want to focus on iFood again. I mean, you've shared some views on the north of 5% EBITDA to GMV, but below 10% for Q-commerce. That's very helpful. Maybe you could talk a bit about the sort of targets you have on a break-even per dark store level and maybe a bit of a view on CapEx on top of what you already provided on the slides. The second question, probably for Larry. I mean, Delivery Hero kind of difficult, right? Your end price there is around EUR 70. You have a stake north of 27%. Very little room to increase at stake here before moving into mandatory offer territory. I'm just wondering how you see that investment at this point. Anything you can say is appreciated. Thanks. Yeah. Actually, why don't I again kick us off, and Fabricio can say something sensible about iFood in the back end. I think on the profitability. You know, obviously, on the profitability, and again, we're gonna see how this plays out over time, but I do think that, you know, something north of 5% EBITDA, percentage GMV is a reasonable target. You asked about sort of CapEx and you know what it costs to launch these things. It really does vary by geography. I think the You know, kind of my standard rule of thumb is from a CapEx standpoint to launch a store, at least what we've seen, not even just with iFood, but around the world, and again, there's a local real estate and local cost component, but it's ±$100,000 from a CapEx perspective and another $100,000 or so from a working capital perspective that it takes to get one of these off the ground. That's typically how I've seen the model across the world. And then on Delivery Hero, look, we're very supportive of the company and you know, happy with our holdings and you know, obviously, there's been a pretty significant market reaction that I think is my own perspective is overblown. We're very happy with the company's performance. I think that Niklas and his team have made sensible investments, including in quick commerce. I couldn't understand completely the first question. You said something to GMV to EBITDA, but I'll try to answer what I got. Number one, Ted, is just a reality here in Brazil, around $100,000 to invest. As I said before, we are confident that getting to 500-600 orders, and we are going this direction without. I'm not very worried that we are going to get this direction. It's going to be profit, and you can pay this level of investment that is not very high per store. Thank you, sir. The next question is from Andrew Ross of Barclays. Please go ahead. Great. Thank you for my question, and good afternoon, everyone. I've got three. The first one is about kind of consolidation and the long-term, kind of concentration you see in this market. When you kind of think five, 10 years out, is this gonna be a kind of winner takes most within a city for dark stores? Is it gonna be three, four people, lots of operators? And what about globally? Are there kind of global synergies as you see it, or are we gonna get into a world where we have just a few big global players in dark stores? That's the first one. The second one is about pricing. At least in London, the pricing of food on dark stores is higher than on a supermarket direct. Can you just talk a bit about how you kind of drive that down and how that interplay with the TAM and the margin works on that pricing debate? The third one is, I think you talked about getting to 400 or 500 orders a day to make these stores break even. Does having lots of stores in the same city also make a difference? Do you kind of get to a critical mass in an area where you start to get those local network advantages? We'd be curious on what you've learned from some of perhaps Flink's most mature cities. Thanks. Thank you for the questions, Andrew. I guess your first and third questions are in some ways related. In terms of consolidation and concentration in the space, I think it's important to note how local the network effects are here. Unlike some other sectors of consumer internet where the strongest network effects are global in nature, this is a very, very local business. We're fortunate that, you know, you can look at grocery retail in the offline world and see how local it is. You can have successful offline grocery stores, offline convenience stores that are single locations. Yes, there are some benefits to scale in the space, be it at a regional or national level. Really the strongest economic drivers are gonna be local. You know, to your second question. Oh, and you'd asked, I guess, you know, do we see basically, you know, this space getting down to kind of winner takes all or winner takes most. Again, we consider it mostly at the local level, and I think if any of us thinks about our own grocery purchase across the various different formats, I would imagine most of us, our grocery items come from a variety of different stores. Local grocery store, local convenience stores, you know, other retailers, et cetera. I don't think the online version of this will look meaningfully different. In terms of pricing, and again, this is where we take a lot of comfort from looking at convenience transactions in the offline world. You're spot on that the actual item pricing, this is not a race to the bottom long term and from a pricing perspective. If you look at, I know in the, you know, where I live, there are convenience stores right next door to grocery stores that have much lower prices. But still the convenience stores have a thriving business, either because they're open longer hours or often because they're just easier to access. I think there's a lesson about consumers in that offline world where, yeah, people are willing to pay for convenience. There are classes of people that are willing to pay more just for speed and accessibility. What we're seeing is that translates to online. This also ties back to why I think our restaurant food delivery platforms have an edge, and this is why it's been a focus for us on the back of these platforms. Because we've already identified those customers that have a willingness to pay for convenience in the restaurant food delivery orders. It stands to reason that they would also be willing to pay for convenience in online convenience transactions. To your last question, on orders per day, that's one of the pieces of the puzzle that, like, local network density is one of the things that I think many of the players in the space are figuring out now. You know, if you're looking at a city, you know, what is the optimal number of stores to put in there? That's where having real analytic discipline and muscle comes into play, right? You can, as you point out, you can drop in more stores and presumably shorten delivery time at some expense. There's a question of how much of that you can pass along to your customers. That's a lot of the work that, in the case of iFood, Fabricio and his team are doing, figuring out as they insert another store in a neighborhood where we know the neighborhoods from the restaurant side. We know where the consumers are. What is the impact of opening another store a few kilometers away when we get to, you know, a certain level of scale? How does that change the economics of delivery? You know, is it, do we shorten the delivery times by a few minutes? Then how much of that incremental cost can we pass along to customers? That's why we're not, in the case of iFood, and I know the same is true for Flink and our other companies, we're not starting with a preconceived notion of how this should end, but really taking a test and learn approach to how we're rolling out stores. I hope that covered your questions. Thank you, sir. I have a quick comment on that. Very quick comment. First, pricing is so important, so my goal is to use technology to reduce pricing. If I can position better the store or buy better, and or through my scale, because my store serves a wider area than a street store. Remember my store, I pay smaller rent also to this store. I can have price benefits, and I try to pass that for the customers using technology. The second, remember the customer acquisition cost I have, because we already have a 40 million user marketplace, is also much smaller connecting that with the last question about investment in each level. I think we have some good elements to make the economics good quite soon. Thank you, sir. The next question is from Silvia Cuneo of Deutsche Bank. Please go ahead. Thank you very much for taking my questions. The first one is on the B2B opportunity. If you could talk a little bit about how you're thinking about this area. We've heard that you know some analysts looking at companies like Edenred in the region, for example, offering employee benefits might see iFood joining in as a competitor in that space. Just wondering what's your thoughts around this? Secondly, just returning to the quick commerce phase and the unit economics. Just wondering, how you are thinking about what one of your peers, DoorDash, commented at an industry conference that probably 15 minutes might be too stretched to operate profitably, while 30 minutes might be more doable. Do you think this could be due to the different country exposures? Thank you. Thanks for the questions. Silvia. I'll apologize, it was a little faint on my end. I'll try to answer your questions. On the B2B opportunity, I'm sure that there is something there in a lot of our markets, but the primary focus for us at this stage is on the consumer opportunity. But it stands to reason that, you know, if you have local warehousing and local inventory and local logistics, that there are a number of adjacent opportunities that can be built on the back of it. You can build advertising, you can build B2B, but as it stands right now, we're solving for the consumer experience and economics at the store level based on that. On the second question about, you know, folks' commentary about how important 15 minutes is versus scheduling. I think Fabricio touched on that before. I touched on it a little bit in terms of how much easier dark store convenience is to deliver than one piece food delivery. Frankly, the harder questions about local logistics came three years ago when people would ask, "How can you do one piece food delivery given the complexity of that setup?" You know, that you place an order, and you can get it to the consumer in 30 minutes. That is a much more challenging analytic and logistics exercise than dark store convenience, which is a hub and spoke model. I think the real question is how far down from a timing perspective do you need to stretch the model where it matters to consumers and where they're willing to pay? Whether it's can you do it in 15 minutes profitably? Sure. In 10 minutes? Sure. It's really just a matter of how much will consumers be willing to pay for that speed, and that will be the driver of profitability. What inventory do you need to have available? That's a lot of the work that our teams are doing now to figure out how much does it matter and how much are consumers willing to pay. As I've mentioned a couple times, our food delivery platforms have a leg up in this exercise because we already know. We have indications of what consumer willingness to pay for selection and convenience is. I think we have time for one more question. Thank you, sir. Ladies and gentlemen, the last question is from Monique Pollard of Citi. Please go ahead. Hello. Afternoon. Thank you for taking my questions. The first question I just had was on slide 18 of the presentation. You've got an 80% quick commerce retention rate, and I think that's versus a 30% overall retention rate. Just wondering how to think about that. Is that just because there's already additional sort of existing customers on the platform, or is that a retention rate of orders, not of customers? Just wanting to check. I also wanted to understand if you could just give a couple of details on to help us with the unit economics on the dark store model a bit more. So how many drops per hour, for instance, can riders do, particularly once you get to scale, and how many orders pickers can pick? The final question I had was on the employee model of the riders for quick commerce. I would assume at the moment, you know, as you're pushing towards scale but not at scale, you need to employ those riders versus having them on a contract basis. Maybe you can just provide some details on, you know, the model that you have to use for employment of the riders. Yeah. Thanks for the questions, Monique. I'll, I think, actually, Fabricio, you're probably better suited to answer these on slide 18 and then, you know, some of the intel or early indications on delivery frequency and picking times. Sure. Let me try to address the three. First was on 80% retention on slide 18. I think your question is good because it highlights it is not like a new customer that is using for the first time his mobile phone, and the retention is super high. What we see is not a new customer that is using for the first time his mobile phone, and the retention is super high. What I see here is that we have more demand from more mature customers that already do their e-commerce and their food delivery. These more mature customers, they have a very high retention because his life fits with this kind of service. We see this 80% related not only to the customer, the service is better, but also the service delivers something for a customer that has a super high demand. I tried to address that when I said some of our best customers, the ones that like more the service or are very willing to keep buying because they don't have time, because they have requirements to receive at home in 10-15, 20 minutes. They order and they keep ordering. That's why how I see the retention is so dramatically high, and it connects to what I said when you say, "If we don't offer that, some other company would address the demand for these customers." That's why I think it's really important to offer quick commerce. On the second thing, drops per hour. I don't know this number exactly because I don't have one number. What I can tell you is, it is higher than food delivery because the radius of delivery is much smaller. We don't do, for example, in food delivery, we do 5, 6, 7, 8 km distance or 9 km distance. Here, most of the deliveries are 1.5 km. Many are 1 km up to 2 km, sometimes 3 km. The driver can go deliver and come back much faster than when you are doing food delivery. It's more efficient. You asked about the employee model, if you are hiring all the delivery people, partners. No. We, in iFood, we have 200,000 delivery partners working with the food delivery, and we use these delivery partners to do this delivery and therefore we use the same hiring structure that we do in food delivery. I was thinking here, 4-5 deliveries per hour is possible. Let's say four, while in food delivery is more close to 2-3. That would be some range in times of delivery per hour. With that, I think we've run out of time. Thank you for listening in, and thank you for your questions. Obviously, we have a lot of work to do here, but we are excited about the opportunity. Appreciate your time today, and thank you again for the thoughtful questions. Thank you, everyone. Thank you very much, sir. It was a pleasure to be here. Thank you, sir. Ladies and gentlemen, that then concludes this event, and you may now disconnect.