This spring, the "last winter" we are looking forward to has not passed, the epidemic has returned, the streets and alleys have become empty, and the physical stores have changed from temporary closure to closure, which has given people a sense of déjà vu that catering people will face a catastrophic impact in 2020.
In North America, months of stay-at-home quarantines have also dealt a fatal blow to the restaurant industry, which lost $240 billion in 2020, according to the National Restaurant Association, one of the hardest-hit industries in the outbreak. Two years on, most venues in North America have lifted mask orders and public places have reopened, but a survey released by the American Restaurant Association this year shows that 70 percent of restaurants still don't have enough staff to support their daily operations, and most restaurant owners don't expect anything to change this year.
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Faced with such challenges, food and beverage technology shoulders the responsibility of saving labor costs and improving operational efficiency, and there are startups in many fields to help restaurants get through the most difficult periods, and they also subtly blow the new wind of digitalization into this "old antique" industry, and capital pours into this track, and the financing of food and beverage technology companies has increased from $800 million in 2017 to $2.3 billion in 2021.
Robots dominate the kitchen: from pizza to salad to coffee
Robotics has been tried in the catering industry long before the pandemic, and the epidemic has exacerbated the shortage of manpower, and this efficient kitchen helper, which does not infect the virus, has become a hot new technology in catering.
Miso Robotics is a company that has gained more attention in the field of catering automation, the most mature product "Flippy2" can complete a variety of tasks such as fried burgers and French fries, can complete 60 food baskets per hour cooking, 56% less space than the previous model, 13% faster time, has reached a partnership with a number of fast food brands, White Castle will be installed in more than 100 stores this year.
Just in March, Miso announced a partnership with Mexican fast food Chipotle to launch a robotic arm that can fry corn flakes, "Chippy", which can not only complete the process of frying, but also flavor it with lime and salt, Chippy is trained to greatly emulate human behavior, seasoning will also deliberately achieve "jagged" simulated taste, miso will also launch a beverage machine this year that can be connected to the POS system. Miso Robotics is committed to becoming a new generation of robotic solutions for restaurant chain brands, making food and beverage operations more efficient, simple and safe, and has completed $79.3 million in financing.
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Stephen's robot technology "The Makeline" from California can carry out assembly line operations in the kitchen, so that the kitchen team can more efficiently prepare food such as pizza and sandwiches, the machine includes the upper part of the manual preparation and the lower part of the machine automatically prepares salad bowls, The Makeline has artificial intelligence vision technology, can accurately control the quality and quantity of raw materials, accurate to grams, when the raw materials are insufficient, it will also remind the kitchen staff to replenish in time, It completed a $24 million Series A round led by Tiger Global in February, after a $10 million round of funding that will be used for robotics research and development, production facility construction and market expansion.
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The robots can make not only cold food, but Kenta Ramen, an automated ramen making machine backed by UpHonest Capital, an early Venture Capital in Silicon Valley, combines delicious quality with a quick and convenient way to make it, allowing customers to eat a steaming bowl of ramen in 45 seconds, suitable for busy urban white-collar workers and students. Kenta's patented ramen vending machine technology and R&D capabilities, its own food supply chain and the culinary essence absorbed from Japanese chefs make the noodle making process efficient without sacrificing taste, and the price of a bowl of ramen for less than $9 is also capitalized and cost-effective.
Drink robot manufacturer Botrista, which completed Series A and Series B financing within four months last year, created the DreamBot, the perfect combination of robots and coffee machines, capable of automatically completing tasks such as metering and mixing in 20 seconds, producing a variety of beverages such as iced tea, coffee and lemon juice.
Botrista investors include Sony Innovation Fund, Middleby Corporation, and UpHonest Capital, an early Silicon Valley venture capital.
Exclusive patented technology gives Botrista an advantage over traditional models in terms of liquid texture, cryopreservation, flavor control and ingredient adjustment, and the machine interface profile is designed to allow operators to get started without training, covering an area of just 5 square feet, making 120 drinks per hour, and using 99% of the ingredients to minimize waste.
In 2018, 4 students from MIT created Spyce, which was called "the world's first robot restaurant" by major media, customers completed orders through tablets, cutting, stir-frying, loading dishes, washing dishes and other processes were completed by robots, each ingredient was set to a precise time and temperature for cooking, the kitchen also has sensors to ensure that cooking runs smoothly, it takes only 3 minutes, customers can personally observe the preparation process of food.
Spyce's menu is dominated by healthy light meals, and the four founders were moved by pure emails and invited Michelin star chef Daniel Boulud as culinary director. Last year, light food salad company Sweetgreen completed its $50 million acquisition of Spyce, which will use Spyce's technology to help improve store efficiency and user ordering experience.
Being acquired is a common fate for food and beverage automation companies, allowing them to focus on the core technology and realize the value proposition, eliminating the hassle of building additional consumer brands to achieve profitability.
For example, Chowbotics, founded in 2014, was acquired by DoorDash for $5 million in February 2021, Chowbotics' flagship technology vending machine "Sally" can customize salads, cereal bowls and cereals according to users' dietary preferences, taking only one minute, and can make 50 to 100 meals at a time before feeding, and users can order in advance without contact. Chowbotics has completed a $21 million funding round before the acquisition, and this technology is crucial for DoorDash to help restaurants expand their menus in the future, such as pizzerias can launch salads, or salad shops can expand their footprints faster.
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Costa Coffee, a subsidiary of Coca-Cola, acquired Briggo, an automated coffee making and vending machine company, after Briggo has completed a $19 million financing footprint in major cities in the United States, Briggo machines can operate 24/7 without human assistance, can complete 100 cups of coffee per hour, and customers can order in advance to reduce contact.
Image source: Briggo
Robotics is also expanding beyond the kitchen, such as the $81 million Bear Robotics robot "Servi", which was just completed in March this year and was led by IMM, and the main use scenario is to transport food and drinks between the kitchen and the table, 100% unmanned operation, and the operation mode of multiple robots can be added and adjusted according to the size of the restaurant.
Bear Robotics received a $32 million Series A round of financing from SoftBank in 2020, and the aging of Japan will become an important market, and in the United States, it has also reached partnerships with several companies such as Chili's, Denny's and Marriott, and has completed more than 330,000 miles of "journey" since its inception, completing the delivery of 28 million meals.
In the short term, the shortage of labor in the catering industry will continue, the sustainable and cost-effective way of food production of robots will become more and more common, the last food technology revolution focused on the rapid packaging of food in the factory, and this time the change will be closer to the consumer side, consumers can even participate in the process of interacting with robots to get a fresh meal in seconds, this freshness will also let many people try.
But freshness is not enough to support the entire business model, such as the once-popular robot pizza company Zume, which has more than $400 million in financing from companies including SoftBank, but in 2020, it made a big wave of layoffs and transformed into a food packaging company.
Eatsa, a San Francisco startup that once focused on automating the production of quinoa health bowls by machines, has now transformed into an analysis software for user data and loyalty projects for restaurants, and has been renamed Brightloom, and data analysis is indeed one of the important needs of restaurants today than spending a lot of money on automation technology.
Data, payments, recipes: save restaurant operations as they go
One of the main features of the catering industry that has not yet been digitized is that the wind of using data to make decisions has blown through various fields but has been skipped by the catering industry, because most of the restaurants have a good attitude of "knowing in their hearts", but in fact, the accurate data they think is just the chef's memory of the ingredients and a few simple digital tables, which are not blown by the wind under the test of the epidemic, and they are scattered in two steps. If understanding the cost of food before the epidemic is a plus for catering, restaurants large and small that have experienced the catastrophe of the epidemic and experience inflation urgently need accurate data analysis solutions.
The software system created by Galley Solutions, a startup from San Diego, starts from the core recipes of the restaurant, shares and trains the recipe information while aggregating, can calculate the real-time cost of raw materials and carry out accurate meal planning, the system interface conforms to the operation habits of the back kitchen, optimizes the kitchen task distribution system, and seamlessly connects the API system with the restaurant technology system to obtain accurate data on net profit, food waste, food cost estimation and labor efficiency tracking. Converged data centers will also lay the groundwork for optimization of various systems in restaurants.
Working on recipes is a great way to get restaurants' attention, and venture capital firm Struck Capital, which has called a "Trojan horse" that digitizes the kitchen, invested $6.5 million last year in Recipe Management Solutions, a recipe management solutions company, Meez Culinary Solutions.
Meez's founder Josh Sharkey himself is a chef, after accidentally losing his notebook to record exclusive recipes, he has this idea of digitizing the old model, Meez's technology allows chefs to upload, store and manage recipes, the system automatically calculates the proportion and cost of raw materials, and can also train kitchen staff to make different meals through videos and other methods, which has become "Chef's Google Drive". Meez, which was founded in late 2020 with only 20 customers, now has more than 750 customers, including high-end restaurants, fast food and cooking schools, and its monthly revenue is growing at a rate of 20%.
Image source: GetMeez
Founded in 2011, Toast provides an integrated POS system for catering companies, exquisite hardware and powerful cloud software functions so that the kitchen, waiters, managers can communicate more easily and efficiently, the unified theme of each function is efficient and smooth catering operations, such as the kitchen order display system so that the personnel before and after the kitchen can see the meal list at a glance to ensure orderly progress, self-service ordering table and handheld POS terminal equipment Tower Go support contactless payment to accelerate the checkout process, The inventory management system showcases goods and data analysis to reduce food waste and control costs, the public information sharing system allows all service personnel in the restaurant to access the data at any time, and the Toast system can provide restaurants with marketing and user loyalty recommendations based on the collected data.
Image source: Toast Central
Toast's main revenue is hardware sales and software service fees, with full-year 2021 revenue reaching $1.705 billion, up 107% year-over-year, and ARR reaching $568 million, up 74% year-over-year. Toast was listed on the New York Stock Exchange in September last year, and its stock price soared 56.27% on its first day, with a total pre-IPO financing of $900 million, and investors behind it, including Bessemer Venture, Tiger Global and TCV, were valued at $20 billion.
JP Morgan Chase and OMERS Growth Equity have invested in TouchBistro is also in the restaurant POS to create a one-stop system, suitable for restaurants, coffee shops, bars and mobile food trucks and other catering outlets, in the restaurant operation has a kitchen meal display system and complete checkout function, you can simply set discounts for dishes, integrate with third-party terminals and mobile wallets, and can also split bills according to user requirements.
It is easy to manage user booking and ordering in the customer experience, restaurants deliver online orders without paying any commission, which is quite different from the cooperation model of takeaway companies such as UberEats, touchBistro also helps restaurants manage user loyalty and gift card projects. Although the focus of the TouchBistro software is currently online ordering, payment and customer loyalty projects, the future plan is more in the back kitchen layout, inventory and catering staff account for 70% to 80% of the cost of the restaurant, but it is also a blind spot for restaurant managers to estimate the cost, most people only know how much it costs to make a hamburger, and there is no global concept.
By optimizing inventory cost management and data integration, TouchBistro refines the analysis to more feasible information such as how much the restaurant is profitable per hour or the percentage of labor costs as a percentage of revenue, so that chefs and restaurant owners can spend less time on administrative tasks and more time thinking about how to improve the restaurant's environment, menus and overall user experience.
Image source: TechRadar
Food and beverage payment systems are also challenges that startups are tackling, such as FormulaIQ, which completed a $160 million Series B round of funding led by FTV Capital last November, which automatically digitizes paper invoices, synchronizes data extraction with restaurant account software, and pays suppliers via mobile.
There is also Sunday, which completed the $50 million Series C financing led by Bond in September last year, allowing customers to view the menu through the QR code and complete the payment in 10 seconds, greatly improving customer turnover, Sunday's last round of financing was a $19 million Series B financing led by Sequoia Capital in late 2020, which plans to increase the number of customers to 15,000 restaurants in 2022.
Takeaway is not only DoorDash and UberEats
When it comes to restaurant food take-out, most people think of companies such as GrubHub, DoorDash, UberEats and Postmates that are primarily consumer-facing, but there are also a number of companies that focus on the restaurant side.
Uber founder Travis Kalanick's CloudKitchens self-positioned as a real estate company, the main model is to rent idle real estate to catering companies, equipped with kitchen equipment, so that many restaurants that can not continue to dine in can adjust to the takeaway model and save self-expenditure, but also provide facility management, technology and marketing and other supporting services, is indeed the concept of WeWork in the catering industry. CloudKitchens just closed a $850 million funding round last November, valued at $15 billion, and TK's main competitor is Kitchen United, which has expanded rapidly in recent months, and United Kitchen also acquired a similar concept of Zuul last October.
Image source: StartupWorld
Founded by the founder of Chicago's top Michelin-starred restaurant Alinea, Tock's core business by 2020 is high-end dining reservation seat ticketing companies, using a dynamic pricing model to sell high-end restaurant seats.
During the epidemic, Tock transformed and launched TheHook To Go, which helps restaurants provide necessary takeaway meals, but instead of charging up to 30% commission like DoorDash, Tock charges a monthly subscription fee of $199, only 2% per commission, while restaurants can also get customer personal data information to help long-term marketing and relationship maintenance, and have successively added two-way SMS communication and other functions, Tock also cooperates with DoorDash and Postmates. Match delivery teams for restaurants and charge takeaway fees.
Tock doubled the number of restaurants and added more than 1,000 Red Bar customers in 2020 because of cost-effective commissions and take-out-and-eat services, and last March Squarespace acquired Twitch for more than $400 million.
Nextbite, which received a $120 million lead from SoftBank in 2020, added a little spark to the takeaway, creating a takeaway-only meal brand for restaurants, using existing kitchen venues, equipment and staff to repackage the food concept into a catering brand with profits of 25% to 30%, discovering the maximum value of indirect costs, and guaranteeing revenue in the off-season, which can add thousands of dollars of revenue to restaurants every month.
Nextbite uses its own software system, Ordermark, to help restaurants manage orders, omni-channel ordering, production and delivery, making and delivery, which is a worry-free and high-revenue operation for restaurants. It has more than 20 brands, and has also launched co-brands with stars such as rapper Wiz Khalifa, and two new food and beverage brands, Thrilled Cheese and Super Mega Dilla, with IHOP this year.
Image source: nextbite
Kitchen digitalization is actually a very Sexy concept in the eyes of capital, and the digitization of restaurant back kitchen and overall operation is revolutionary to the biggest steps of recipe preservation, order tracking, inventory management and other pain points, which can also reduce food waste, greatly reduce costs, and help them develop additional revenue channels at this hot time in the catering industry.
Many catering companies do not survive the winter of the epidemic, not only because of the lack of in-store traffic and the shortage of employee labor, in fact, this is also a process of natural selection, how to improve efficiency and quality in every aspect of the operation will determine whether the catering can survive, these startups will be able to help carry out this process of survival of the fittest, and the catering industry evolved into a new era.
Reference Sources
Restaurant Staff Shortages Pique Appetite For Automation（Crunchbase News）
Digitizing The Kitchen: VCs Turn Up The Heat On Restaurant Tech Investment（Crunchbase News）
Meez keeps recipes in one place so chefs can continue whipping up culinary delights (TechCrunch)