As a former investor in Webvan, I would like to know if anyone out there who knows this industry can tell me why Peapod survives while Webvan failed many years ago. Webvan was financed by VCs and Peapod is financed by a European retailer, and I am wondering if the retailer is simply more patient. Is Peapod making money? (I know that the company isn't public, so we don't have their financials.)

In New York City, the business model was to pay West African immigrants $80-$100 for a 60-70 hour week as walking deliverymen (Manhattan and parts of Queens and Brooklyn have the population density to allow that). That let supermarkets offer free delivery. Unfortunately, there now is a fee for delivery (I think $4 at most places) because my firm filed minimum/overtime wage class actions against the four major supermarket chains, and most now pay minimum wages plus overtime (in addition to the millions they've had to pay in the lawsuit).

Once again, those durn lawsuits drive up costs for businesses and consumers. Running a sweatshop ("walking sweatshops," we called them) ain't what it used to be....

Groceryworks in Houston was affiliated with Randall's grocery store and had drivers. When it went under, critics cited to the fact that Groceryworks would guarantee delivery within 30 minute windows, which made delivery complex and expensive.

I would point out that Webvan had an IPO and Peapod did not. If I were cynical, I would say that because Webvan's shares popped so much the first day that 80% of their working capital went to investment banks, institutional investors, and their silicon valley lawyers, who took equity in addition to fees.

Peapod is terrific. I have been using them in Chicago for the past 3 years (I get a delivery every week), and I have only had a problem once or twice (wrong items or something like that). And they credit me (so I get the wrong item for free).

It is perhaps a bit expensive (delivery fees are 6 bucks to 11 bucks depending on whether you spend over 50, 75, or 100 for your order). But the actual item costs are in line with the grocery stores nearby. I think 10 bucks is more than worth the convenience (especially living in a high rise).

Their selection is pretty good too, of course I am not very picky, but I can't really think of anything they don't have that I would want to buy.