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The Spoon

Daily news and analysis about the food tech revolution

Chris Albrecht

Some States Halt Re-Opening, Bars Ordered to Shut Down

Twelve states have stopped their former plans to re-open businesses amid continued growth and record setting numbers for coronavirus infections. Florida and Texas have shut down bars, and Texas also reduced capacity at restaurants from 75 percent to 50 percent. California ordered bars to shut down in seven of its counties, including Los Angeles county.

As CNN reported over the weekend, states halting their re-opening plans include Arizona, Arkansas, Delaware, Idaho, Louisiana, Maine, Nevada, New Mexico and North Carolina. Washington state also announced over the weekend that it is not moving into phase four of its re-opening.

Coronavirus cases continue pretty much unabated across the U.S., with a record 44,726 new cases reported last Friday.

The restaurant industry has been decimated by the pandemic As my colleague, Jenn Marston wrote last week:

As of June 15, roughly 140,000 businesses were listed on Yelp as closed. While retail got hit the hardest, restaurants came in at a close second, with 23,981 businesses closed. And here’s the kicker: more than half — 53 percent — of those restaurants currently closed won’t reopen, according to Yelp.

For most restaurants across the country, re-opening dining rooms meant fewer tables spaced further apart, as well as a host of other guidelines such as disposable menus and servers wearing face masks, all meant to help prevent the spread of the coronavirus.

And there’s some indication those measures were working in bringing people back. While restaurant sales were down year-over-year, NPD data showed that they sales were growing, even as cases of COVID spiked. From a recent NPD press release announcing the firm’s latest findings:

For the week ending June 14 total major restaurant chain transactions are down -12% versus the same week a year ago, which is -1% below the previous week but the ninth consecutive improvement year-over-year, reports NPD. Quick service restaurants still managed to improve slightly to -11% versus year ago compared to -13% the previous week. As dining rooms reopen, full service restaurant chains continue to have the strongest improvement in customer transaction declines, having a week-over-week gain of 12% in week ending June 14, moving up +6 points on a year-over-year basis to -26% versus year ago.

It’s too soon to say how high the number of COVID-19 cases will reach over the next few weeks or how many more restaurants and bars will have to close again as a response. Offering takeout, drive-thru, curbside pickup, and other off-premises channels was a small lifeline to businesses during nationwide shelter-in-place mandates. Restaurants large and small are being encouraged to continue keeping their focus on these areas, in the hopes that off-premises will help them keep the lights on if dining rooms are once more forced to close. 

Can Food Tech Save the School Cafeteria?

I’ve been getting emails from my son’s elementary school saying that they plan on having some form of in-school instruction come September (knocks on wood). Some of the new regulations to ensure that happens are things like requiring masks, limiting the number of kids who can interact with each other, and social distancing.

There is obviously no perfect solution, and there are still a ton of unknowns, but my son is excited at the prospect of going back to school and hanging out with his friends. (Plus, teacher dad is not his favorite.)

My big question is around how schools will handle activities outside of the sit-down classroom. Specifically for the purposes of The Spoon, how will the school handle the cafeteria and lunch? Facemasks can’t be worn by kiddos while they are eating. Talking (read: yelling) will be tough six feet apart. And kids, well, will be kids.

Do they need plexiglass shields in between each kid? Individually packaged meals? Should they eat outside? (Though here in the Pacific Northwest, that’s only possible until October.)

I write about companies doing innovative things to battle this pandemic every day. Robots delivering meals. Vending machines replacing the salad bar. Mannequins to enforce social distancing in restaurants.

But none of these solutions seem to be up to the task of managing the unique chaos of a school cafeteria packed (or at reduced capacity) with a bunch of 5 – 10 year olds. Is there any way to innovate school lunch in the time of COVID-19?

The question is so broad and complex that I feel like I’m asking it into the wind because it seems like there is no answer. Maybe a Spoon reader has a better answer or at least an idea. So what do you think? What can food tech do to keep the cafeteria as safe as possible?

Country Garden Opened a Massive Robot Restaurant Complex in China This Week

You may be debating whether or not you’re ready to go back into a restaurant. But what if that restaurant was operated entirely by robots? Would that make you more inclined to eat out?

Earlier this week, the Qianxi Robot Catering Group, a subsidiary of Country Garden, opened up a robot-powered restaurant complex in the city of Shunde in China’s Guangdong province.

The complex is 2,000 sq. meters (more than 21,000 sq. ft.) and serves Chinese, hot pot and fast food. The restaurant can serve 600 diners at once, offering 200 menu items that can be served up in as little as 20 seconds, according to the press announcement.

The complex has more than 20 robots developed in-house by Qianxi that cook up a variety of different styles including Chinese cuisine, clay pot rice and noodles. Though the press release doesn’t mention them specifically, from the accompanying photos, there is also a small army of pink server robots to bring dishes out to tables. No word on whether these were developed in-house as well, but they don’t look like the server robots make by PuduTech, Keenon or Bear Robotics.

Country Garden’s restaurant certainly isn’t the first to use robots. Spyce Kitchen in Boston uses robots to cook. Caliburger has Flippy grilling burgers. And Bear Robotics’ Penny server bot has been put to work shuttling food in restarants. But Country Garden seems to be among the first putting all of the front and back-of-house pieces together, and doing so at scale.

In addition to a having a bunch of robots, the Country Garden restaurant is also contactless, a factor increasingly important on our pandemic planet. As restaurants re-open here in the U.S., businesses and eater alike are grappling with restrictions like facemasks and socially distant tables. Having a full-on robot restaurant isn’t a guarantee to prevent the spread of COVID-19, but it does remove some human vectors from the equation.

It’s a question I’ve asked before, but what will make people more comfortable inside restaurants: the human touch while wearing a facemask and gloves, or the cold sterility of a robot?

Byte Adds Dynamic Pricing to Its Smart Vending Fridges

Byte Technology added dynamic pricing to its smart fridges this week, giving its clients the ability change prices of stocked items on the fly.

Through a combination of RFID and IoT, Byte makes smart vending refrigerators that allow shoppers to swipe their credit card, take what they want from that fridge and get charged automatically. The company licenses its technology platform to retail operations like supermarkets or restaurants, which brand the fridge to sell their packaged food (or anything really).

Because of the RFID tags and connectivity, a Byte fridge knows exactly what’s in its inventory as well as what items sold, when and to whom. With the addition of dynamic pricing, Byte fridge operators can now automatically discount items for just about any reason.

For example, if a fridge is stocked with fresh sandwiches, the operator can create a 25 percent discount on any of them set to expire. Because the fridge already knows everything about its inventory, it automatically knows which sandwiches this discount would apply to, so the operator doesn’t have to set a specific date or create a new rule each time. It could also run promotions on particular drinks, such as half-off carrot juice after 5p.m. on weekdays, or broader discounts like discounts on cobb salads every Monday.

By giving operators the ability to offer dynamic pricing, Byte hopes to reduce the amount of spoilage and food waste created through its platform. This type of dynamic pricing already exists in grocery stores through solutions like Wasteless, which algorithmically discounts food price based on factors like expiration date. And the Karma app teamed up with Electrolux to create special fridges in grocery stores that sell almost expired food for at least half off.

As I wrote about in my recent The Great Vending Reinvention: The Spoon’s Smart Vending Machine Market Report, the COVID-19 pandemic is forcing retailers to examine new, contactless ways of selling. Vending services like Byte’s offer the ability to sell products without human-to-human interaction. And though the pandemic has shut down offices, which were a main line of business for Byte’s machines, Byte Founde, Lee Mokri told me by phone this week that it is seeing increased interest from places like residential buildings.

Come to think of it though, having a smart vending machine in the lobby of an apartment building that can automatically discount a pint of ice after midnight might not be the greatest thing in the world.

Cheetah Now Lets You Buy Prepared Restaurant Meals with Your Groceries

At the height of the everybody-panic-grocery-shelves-are-bare phase of this pandemic, Bay Area-based startup Cheetah pivoted from selling food to restaurants to selling that same food directly to consumers. Today, Cheetah announced that it is going back to its roots, in a way, and selling prepared meals from restaurants.

Cheetah’s Restaurant Picks service is open to all restaurants in the Bay Area and is kicking off with Curry Up Now, Hummus Bodega, La Mediterranee, Tartine and Zero Zero SF to sell prepackaged meals through the Cheetah app. As with its grocery service, orders are picked up by customers at one of four locations around the Bay Area. Users are only able to order food from the restaurant in that pickup location (e.g., Curry Up Now meals are only available to people picking up food in the Inner Sunset neighborhood).

Unlike third-party delivery services, Cheetah is not charging a commission for its service, just the standard credit card processing fees.

The lines between restaurant and grocery stores were already blurring pre-COVID-19 as grocery stores offered an array of hot meals to take home. The pandemic not only decimated the restaurant industry, but also shut down that hot bar side of the business for grocers.

Cheetah’s Restaurant Picks take up the mantle of that blurring between grocers and restaurants, but just in a whole new direction. Cheetah went from connecting restaurants with wholesalers, to connecting consumers with wholesalers. In each of those cases, those connections helped keep businesses open and people fed. Now it is doing the same on the other side of the equation by giving restaurants a new revenue source directly from consumers.

With the pandemic showing no signs of slowing down here in the U.S., and Cheetah flush with recent funding, I wouldn’t be surprised to see Cheetah create even more connections across the restaurant meal journey.

TurtleTree Labs Raises $3.2M Seed Round for its Cultured Human Breast Milk

Turtle Tree Labs, a Singapore-based startup that creates milk from mammalian cells, announced yesterday that it has raised a $3.2 million seed round of funding. Green Monday Ventures, KBW Ventures, CPT Capital, Artesian, and New Luna Ventures all participated in the round.

As we’ve covered previously, TurtleTree Labs uses cellular agriculture to grow mammary gland cells in a nutrient rich bath that actually lactate milk. This company is initially focusing on re-creating human breast milk, and will follow that up with cow milk. Because they are creating milk in the lab, scientists can alter the milk to give it different attributes like higher or lower fat or cholesterol.

When we spoke to TurtleTree at the end of 2019, the company had plans to debut its first glass of human breast milk in Q1 of 2021 and enter the market at the end of 2021. We don’t know if the COVID-19 pandemic has altered any of those plans, but in its funding announcement, TurtleTree said that the Singapore government has been supportive, allowing the company to continue its work apace.

Cultured breast milk seems to be a pretty hot space right now. TurtleTree’s funding comes just a week after BIOMILQ raised $3.5 million for its cultured breast milk solution.

It’s not hard to understand why cultured human breast milk is attracting funding. It has the potential to provide a healthier and more environmentally friendly option for women who are unable to produce enough breast milk on their own because of biological or environmental reasons.

That is still years away, however, as companies like TurtleTree need to continue development of its product and scale up to make its milk more affordable. This new round of funding will definitely help that.

Target Rolls Out Grocery Curbside Pickup Options Nationwide

Target announced today that it is expanding its Order Pickup and Drive Up services for fresh and frozen groceries nationwide. These services will be available in 400 stores by the end of this month and will hit 1,500 stores by the holidays this year.

According to the press announcement, 750 items across produce, dairy, bakery, meat and frozen products (so it doesn’t seem like you can order everything from Target’s grocery section). Orders will be ready for pickup just a few hours after being placed, and there is no extra charge for using the pickup services.

Techcrunch writes that Target won’t be using Shipt, the logistics company it acquired a few years back, for fulfillment. Instead, Target employees will pick and pack the groceries and hand them off.

Having a contactless curbside pickup program is table stakes anymore during this pandemic, as many people still look to avoid actually going in to grocery stores. The Wall Street Journal recently quoted a study from Nielsen that found grocery pickup sales are up 81 percent since the beginning of the year. Retailers like Walmart, Kroger and Albertsons are carving out more space for curbside pickups, and Walmart, in particular has a geofenced system so it knows when you arrive.

Having tried curbside pickup from a number of different retailers over the past couple of months, Target’s was always the most frustrating. Some items were available for Drive Up service, while others were only available for in-store pickup — or only available if you shopped in the store yourself. This patchwork of availability made creating some unified e-commerce order across their entire store a mess.

Hopefully this rollout will smooth out these inconsistencies and create another nationwide option for online grocery shoppers who want curbside pickup.

Square Launches New Service So Restaurants Can Take Delivery Orders Directly

Payment processing company Square announced today the launch of its new On-Demand Delivery for its customers using the Square Online Store. The service allows restaurants and other sellers to take and fulfill delivery orders directly through their own websites, rather than going through a third-party delivery service.

Off-premises eating had been a growing portion of the restaurant industry’s revenue before the pandemic hit. Once restaurants were forced to close down dine-in operations out of COVID-19 concerns, delivery and curbside pickup became the only way restaurants could stay afloat.

But typically if restaurants want to offer delivery, they need to sign up for a third-party delivery service like DoorDash or Uber Eats. Those third-party delivery services charge high commissions and fees that basically gobble up most of the money a restaurant earns and drives up the price for consumers.

Square is letting restaurants bypass some reliance on those third-party delivery services by letting restaurants accept delivery orders directly on their own websites. From a Square blog post today announcing the new feature:

When an order is placed on the seller’s online store, a courier from the restaurant’s delivery partner is dispatched to the business location, picks up the order, and delivers it to the buyer. The buyer receives text updates with links to live maps to track delivery progress. Sellers pay a flat fee of $1.50 per order to Square, plus a fee to their delivery partner that is calculated in real-time based on distance and other factors. Sellers can pass this fee entirely to the buyer or offer custom delivery promotions. When applied across hundreds of delivery orders each month, sellers can save a significant amount on per-order costs.

There are some devils in these details. For instance, Square’s On-Demand delivery is now powered by Postmates, which itself a third-party delivery service (Square says more courier services will be added). Per Square, the restaurant is still paying Postmates a fee “based on distance and other factors.” The question then is, how much cheaper is it for a restaurant to take the delivery order directly and just use Postmates as a courier than it is to take orders via Postmates? Because part of what you pay for with a third-party delivery service is access to their large marketplace of customers looking for something to eat. Will abandoning third-party services save enough money?

Regardless, this is another example of the continuing evolution of the restaurant industry trying to navigate this pandemic and beyond. Third-party delivery services were a hero, then the villain. Restaurants that had once outsourced delivery are now looking to bring it back in-house, or create some type of hybrid solution.

Square’s On-Demand feature is more fuel for even more change.

No Whey! A Rundown of Alternative Cheese Startups

With summertime here, vegans across the country will be grilling up sizzling Beyond and Impossible burgers . While the burgers themselves may be delicious, there is still a deficit when it comes to non animal-based cheese they want to melt on there.

But the days of lackluster vegan cheese will soon be a thing of the past, as there are a number of startups working on non-dairy cheese — and raising millions to do so. Here’s a list of companies rising up to the cheese challenge:

  • Heartbest is a Mexican startup that recently raised $2 million for its plant-based cheese that uses ingredients like amaranth, quinoa and peas.
  • GOOD PLANeT Foods makes plant-based cheese from coconut oil, potato starch and natural flavorings and is widely available at retail locations like Walmart, Costco and Whole Foods . The company raised $12 million last month to expand production.
  • Grounded Foods uses cauliflower to create cheeses like camembert guyere and roquefort, and is part of the Big Ideas Ventures alternative protein accelerator.
  • Noquo Foods has ditched traditional plant-based ingredients for its product and instead relies on a “stable matrix” of legumes to better replicate cheese. The company raised $3.6 million at the beginning of this year.
  • Legendairy Foods ferments microbes in a process similar to creating insulin and has already created prototypes for mozzarella and ricotta. The German company raised $4.7 million in funding last year.
  • New Culture is also creating mozzarella cheese in the lab, using “recombinant protein technology” that also uses genetically modified microbes to make milk protein. It raised $3.5 million last year.
  • Perfect Day uses fermentation of microbes to recreate cream cheese and feta in the lab and has raised $201 million in funding so far.

Though most of these startups won’t save vegan bbqs this summer, saying (non-animal) cheese, please, is something they’ll definitely be able to do in the not too distant future.

Why I’m All-in on Smart Vending Machines

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Vending machines are cool.

No, really! Between robotics, IoT and way better food, today’s vending machines are poised to be a great, pardon the phrase, disruptor in food tech.

To fully understand why I’m all-in on vending machines, you should check out my new report, The Great Vending Reinvention: The Spoon’s Smart Vending Machine Market Report over on Spoon Plus, our new research and virtual events membership community.

The report covers a ton of players in the space including Chowbotics, Yo-Kai, API-Tech and many, many more. I don’t want to spoil it for you, but here are just a few reasons I’m so excited about the smart vending machine space:

  1. COVID-19. If/when we all emerge from this pandemic, people will want fewer human hands touching their food. Smart vending machines literally keep all their ingredients inside a sealed box and provide automated service.
  2. Small footprint. Because they don’t require much physical space, they can be set up quickly almost anywhere and run around the clock. They also provide a lower-cost way to launch a food brand into new outlets (like existing retail spaces!).
  3. Better food. Robotic arms and fast service don’t amount to much if the food is junk. Thankfully, there is a new wave of machines making fresh food from menus created by actual chefs.

To be sure, things right now aren’t exactly rosy for the smart vending machine space. Cafe X shut down its SF locations, Stockwell shut down and the European Vending & Coffee Service Association said its operators are experiencing losses of up to 90 percent.

It’s not hard to understand why we’re in a dark time. Vending machines are meant to be in high-traffic areas where people want food quickly. Places like airports, offices and dorms. Guess what’s shut down right now? Airports, offices and dorms.

But as I lay out in the report, there’s reason to believe that new opportunities will arise, and with it the whole smart vending sector.

Sign up for Spoon Plus and take a look at the report let me know what you think.

Could Apple Clips Bring Contactless Payments into the Mainstream?

During Apple’s Worldwide Developers Conference yesterday, Apple announced App Clips. Basically, it let’s you get can access specific functionality of an app without having to download the full version of that app.

So for example, you could visit a coffee shop and pay with your phone without having to download that coffee shop’s app, set up an account and enter credit card information. Everything is done through Apple Sign In and Apple Pay.

This is actually a big move in a pandemic world where contactless payment options will be more important when it comes to getting customers to eat inside restaurants again. Apple greasing the skids like this with its massive footprint could make contactless payments more ubiquitous.

Apple also showed off other potential uses for Clips, including finding a nearby restaurant and even interacting with connected kitchen services like Drop. Perhaps we’ll see micro-transactions for connected devices, like buying a recipe specifically for an appliance, rather than getting a premium subscription.

We’ll certainly be watching to see what kitchen uses Clips comes up with.

Investing into the Future of Restaurant Tech

Restaurants are going through an unprecedented time of flux. What are some of the opportunities and challenges ahead for the industry? Brita Rosenheim, a Partner at Better Food Ventures recently shared her thoughts on “the new normal” for restaurants and what they need to do to adapt. Following is an excerpt of her guest post (you should totally read the whole thing, though):

Convenience reigns supreme: The shift to take-out/delivery will reshape the basic premise of many restaurants

Well before COVID-related shutdowns, the increasing customer demands for convenience had already fueled a major shift from dine-in to take out/delivery. In 2019, we reached the tipping point where off-premise sales (drive-thru, takeout, delivery, catering) represented a majority of U.S. restaurant revenues. Now, intensified by a decimated restaurant industry and an uncertain socially distanced future, the growth of off-premise will only continue.

As restaurant operators increasingly respond to our “new normal”, we have seen many full-service restaurant concepts testing a more “fast casual” off-premise approach, with increased tech-focused integration, minimized employee/customer exposure, and a lot of creativity to inject hospitality into socially-distanced interactions.

The bottom line is that the restaurant experience – from QSR to Fine Dining – will increasingly no longer be confined to the four walls of a restaurant. We have reached an urgent point where the basic premise of dine-in restaurants must evolve in order to generate the sales volume and margins to remain financially viable. 

Impossible Sausage Sandwiches Now Available at Starbucks and Burger King

Starbucks announced today that it has added the Impossible Breakfast Sandwich to its menu. The sandwich, which Starbucks says is now available at “the majority of Starbucks locations across the US,” features Impossible’s plant-based sausage.

This is the second move into breakfast for Impossible in as many weeks. Burger King, which launched the Impossible Croissan’wich earlier this year, announced last week it was going national with the item for a limited time.

Impossible is really starting to flex it plant-based muscles and it expands its heme-pire at just the right time. The COVID-19 pandemic has caused production shortages and raised new ethical concerns about eating meat, and during this time, sales of plant-based meats have taken off.

For its part, Starbucks has more than one plant-based partner on its dance card. While the company is launching an Impossible sandwich in the U.S., it has hooked up with Beyond for a breakfast sandwich in Canada, and Starbucks in China will be using Beyond meats as well.

Getting on the menu at Starbucks will certainly give Impossible’s brand a boost. And if people like Impossible, there are more options than ever for them to eat it at home. Impossible has, err, beefed up its retail pipeline over this year, and launched its own direct to consumer sales site earlier this month. Though the sausage only just debuted at CES this year (which feels like a lifetime ago), the Starbucks and Burger King partnerships show that it has scaled up production fairly quickly.

Now we’ll see if the Impossible breakfast sandwich rises and shines.

Amazon to Fund Food Companies as Part of New $2B Climate Pledge Fund

Amazon announced today the launch of The Climate Pledge Fund, which will use an initial $2 billion in funding to back clean technology companies including those in the food and agriculture space.

The fund is part of the broader Climate Pledge, an initiative founded by Amazon and Global Optimism last year to achieve net zero carbon by 2040, 10 years earlier than the Paris Agreement deadline.

From Amazon’s Climate Pledge Fund page:

In order to meaningfully reduce the amount of net greenhouse gas emissions, low-carbon solutions need to be developed in all sectors of the global economy. The Climate Pledge Fund will invest in companies in multiple industries, with an initial focus on: transportation and logistics; energy generation, storage, and utilization; manufacturing and materials; circular economy; and food and agriculture. Companies of all sizes and stages will be considered, from pre-product startups to well-established enterprises looking to scale. The scope of The Climate Pledge Fund is global and will consider investments in companies developing products or services that reduce carbon emissions and help preserve the natural world.

The fund announcement comes while the world is still in the throes of a global pandemic, which has had both positive and negative impacts on the environment.

There are plenty of opportunities for Amazon to make a big impact when it comes to de-carbonizing the meal journey. We cover a ton of startups that are fighting food waste, developing tools for sustainable and precision agriculture, and creating alternative proteins that don’t require resource intensive livestock raising.

The Climate Pledge Fund is accepting “indications of interest” right now via email.