How to Make Money

By Car, Bike or Scooter: Make Extra Cash as a Courier through Postmates

May 5, 2015
by Jessica Stillman
Contributor

Lazy urbanites and venture capitalists love Postmates, a service that allows you get anything delivered with a few touches to your phone. The startup has grown significantly over the last two years, raising $16 million in VC funds and expanding to cities across the country, including Denver, Boston, Portland, Atlanta, Chicago, New York, Houston, Dallas, and the San Francisco Bay area.

And now that Postmates has new deals with McDonald’s and Chipotle, you can bet we’ll see an increasing number of food deliveries.

It’s easy to see why anyone with disposable cash and a late-night ice cream craving, as well as professional investors, might be keen on the idea. But how does Postmates look from the other side of the equation? How worthwhile is the service for people who work as its couriers?

How much cash can you earn, and is it worth the effort?

The case for (and against) becoming a Postmates courier

The company webpage lays out logistics for applying to be a courier. You need to live in one of the markets served — here’s a complete list of cities where Postmates operates — and own a car, bike, scooter or motorcycle. You also have to be at least 18 and either own an iPhone or lease one from Postmates.

Once you’re signed up, have passed a background check and attended an orientation, you set your own hours and keep 80 percent of the delivery fee, which starts at $5 (depending on distance), along with tips. Postmates says experienced couriers can earn up to $25 an hour.

The median earning per hour during peak times is $19, CEO Bastian Lehmann said at a TechCrunch event. TechCrunch also quoted him as saying it’s best as a part-time gig, rather than a full-time job:

“I’d like it to be a full-time job in the future, but the reality is it’s probably a really good part-time job,” he said. “It pays a lot more than other part-time jobs. If we look at median compensation during peak times, that’s 40 percent to 50 percent more than a barista makes.”

Postmates uses a system they call “Blitz Pricing,” whereby deliveries cost more during peak hours. It’s similar to car service Uber’s surge pricing and is meant to incentivize couriers to work when it’s busy. If you’re available when Blitz goes into effect, that’s an opportunity to earn a higher hourly rate.

Unlike Uber, Postmates also allows customers to tip couriers, which can add to your earnings. The app gives options of a 5%, 10%, 15% or 20% tip.

Perhaps the best perk of this gig is the hours: you get to choose your own. That means you can work after your day job or on the weekend, or if you’re a freelancer with flexible hours, hop onto your bike to make a few deliveries when you see Blitz Pricing go into effect. Postmates says it’s a great fit for college students looking to earn some money, too.

One courier’s experience with Postmates

To get a street-level view of the experience, TechCrunch’s Ryan Lawler gave it a go as a Postmates courier. His entire write up is worth reading if you’re seriously thinking of signing up (or check out the video version), but the basic headlines are as follows:

  • You often have to wait a long time to pick things up — at least in San Francisco when Lawler tried it. “Based on my limited experience, delivering for Postmates means you spend more time waiting in line than doing anything else,” he writes.

  • The pay isn’t mindblowing. Lawler did three deliveries in three hours, earning $8 in tips (though the last was to a friend who stiffed him, so regular jobs might have earned him $12). Say a $5 fee for three jobs plus $12 in tips, that’s $27 for three hours or $9 an hour. Is that typical? Not according to the official company line, but the jury’s still out.

  • For the right person, it can be fun. Postmates might not be a route to riches, but if you like to zigzag around time and have time to kill (students, I’m looking at you), this could be a fun way to earn some extra money. “It was a lot of fun and I enjoyed my day as a Postmate,” concludes Lawler, though he resolved not to quit his day job.

Looking for more perspectives? Glassdoor has a bunch of reviews from couriers. Some complain about low pay and lack of benefits, though the level of angst seems to correlate with pre-employment expectations. Those who wanted to earn a little cash on flexible schedule doing something they enjoy are clearly far happier than anyone expecting this to be a real job.

The bottom line: Want a steady, high-paying gig? Postmates might not be for you. But if you enjoy biking or driving around town and are eager to earn a few extra dollars on the side, give it a whirl.

Your Turn: Have you worked as a courier for Postmates? Tell us about your experience in the comments!

Editor’s note: This post was originally published in May 2014. We revamped and updated it so the information is even more helpful for you as this opportunity grows!

Jessica Stillman is a freelance writer based in Cyprus. She has a daily column for Inc.com and has written for Forbes, CBS MoneyWatch, GigaOM, Brazen Careerist and Women 2.0. Follow her @EntryLevelRebel.

by Jessica Stillman
Contributor for The Penny Hoarder

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