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Long Form

December 14, 2020

Connecting Demand to Supply: 2021 Food Supply Chain Tech Outlook

This is a guest post written by Seana Day and Brita Rosenheim, Partners at Culterra Capital, an advisory firm focused exclusively on tech-driven innovation across the food system. You can also find their 2020 Farm Tech and Food Tech Industry Landscapes and analysis at Culterra Capital.

We have been covering the Food Tech and AgTech sectors for the past decade, yet COVID-19 thrust the food supply chain into the spotlight as we could have never anticipated. Against the backdrop of the current pandemic, as well as nearly $500 billion in annual food waste occurring from food harvest to distribution and retail globally, it was time for a dive deep into the technology that will shape the food supply chain in 2021 and beyond. 

For those also following the tech-driven food sector it is no surprise that, to-date, most investment and innovation fanfare have been focused on the food system end-points of AgTech and Food Tech. However after our recent odyssey into the Food Supply Chain Tech category, it is quite clear to us that there is a tremendous, untapped opportunity for vertical-specific technology companies which are focused on serving the unique needs of the food supply chain.

It is with this sense of urgency and optimism about new frontiers of innovation, agility and investment that we launch Culterra Capital’s inaugural 2021 Food Supply Chain Tech Landscape:

Click image to enlarge.

For the purposes of this analysis we have highlighted a handful of predictions for the year to come, as well as emerging themes and key innovation trends that we believe will continue to impact the four supply chain pillars (Supply, Production, Logistics/Distribution, Demand).

While we cover a number of digitalization-driven opportunities for food system participants to strengthen their resilience, profitability and agility, we will reserve deeper dives into the sector-specific drivers and practical adoption obstacles in later reports. But first, a brief primer on navigating the landscape before we dig into our key takeaways below:

How to Navigate the 2021 Food Supply Chain Tech Landscape

  • “Food Supply Chain Tech” here generally refers to the technology enabling the processes and movement that occur between the farm gate and the loading dock/back door of the grocery retailer/food service provider. 
  • This is a heatmap, not a comprehensive catalog: While clearly not exhaustive, this map is meant to illustrate the layers and variety of technology solutions, early stage to mature, and primarily enterprise or B2B-focused. We have generally filtered the companies based on their food and ag customer base, and while mainly US-focused, have included a handful of global companies. Our FarmTech (inside the farm gate) and Food Tech (retail/food service/D2C) landscapes cover the other end points of the food system.  
  • IT-Driven Focus: The landscape focuses predominantly on digital technology-related companies, and although hardware is (mostly) unplugged from this landscape, there is a strong recognition that hardware is an essential part of the technology landscape, especially as it relates to key trends around Industry 4.0 and networked equipment.

In order for us to drive down and understand the many, extraordinarily complex functions involved in the food supply chain, we have organized the market around four key pillars of activity: 

  1. First Mile (Supply)
  2. Production / Food Processing (primary and secondary)
  3. Distribution and Logistics
  4. Retail / Food Service / D2C (Demand)

Across the bottom of the landscape, we included value chain players which integrate across multiple pillars.  

Is Data Automation Bringing Sexy Back?

The overall food and ag industries are among the lowest penetration of digitalization relative to every other sector of the global economy. And while it is well understood across the food industry that modernization and investment in data infrastructure represent a necessary and essential first step, the challenge of “going paperless” is still a real hurdle.

Yes, we understand that “going paperless” is less sexy than, perhaps, micro-fulfillment robotics. But increased workflow and data automation solutions in the food supply chain holds significant power to help the food supply chain leapfrog into digitalization.

Data automation leverages ML/AI to digitize and automate document processing and manual back office processes like managing vendors, suppliers, contracts, key communications, appointments, and so on. Because of the highly fragmented nature and sprawling ecosystems, data automation brings critical resource management, accuracy and most importantly, an underlying digital foundation to the food supply chain. 

Examples of workflow and data automation solutions focused on the food sector include Proagrica, Big Wheelbarrow, and Wholesail. 

A digital foundation is also a key enabler of business innovation for participants up and down the Food and Ag system, like data-driven demand prediction. For example, today our food system is fundamentally supply-driven. Crops or livestock are harvested at a point in the season, and the producer is a price taker. Producers have long sought to overcome this risk / reward imbalance by vertically integrating, and we continue to see that from all sides whether it is Kroger or Walmart integrating their dairy supply chain, or Driscoll and Naturipe branded berries.

Those players who have access to demand data from the retailers, consumers and foodservice outlets, and can control several steps in the supply chain, can better understand when and where to sell, as well as how to maximize their profit through demand insights. 

Similarly, with better demand data flowing into the distribution, logistics and production pillars, companies can better manage over / underproduction and reduce waste, while also improving the utilization of their own assets (equipment, labor, utilities, storage, etc.). 

MOM Knows Best?

Mostly overlooked by venture capital investors, there has been a dearth of significant outside investment in food production and manufacturing business tools, like Manufacturing Operations Management (MOM) software, which represents a collection of systems for managing end-to-end manufacturing processes and automation. The core MOM subsystems include: 

  • MRP (Material Requirements Planning):  packaging, raw material planning, procurement scheduling, etc.;
  • MES (Manufacturing Execution Systems): used to track and document the transformation of raw materials to finished goods; and
  • Other categories of Enterprise Asset Management which fall into this broader manufacturing tech category. 

Largely the domain of established and legacy software companies, vertical, food-focused MOM and Enterprise Resource Planning (ERP) systems are becoming increasingly recognized for their potential to supply foundational, batch-level data for AI/ML-driven analytics, more nimble food production processes, greater workflow automation, optimization of procurement, and so on.  

At the same time, the broader technology landscape is shifting from a traditional manufacturing automation stack (ERP/MOM) to a IIoT stack (Industrial Internet of Things) which leverages a combination of app development, platform cloud, connectivity, and hardware. This intelligent manufacturing stack will be central to unlocking the promise of a more agile, visible and collaborative food supply chain.  

In looking ahead, it is important for tech innovators to understand both the complexity and opportunity stemming from ERP/MOM/IIoT stacks, as the critical data captured in these subsystems has multiple beneficiaries and is also poised to enable business model innovation across the value chain, from ag producers, to manufacturers, distributors and beyond. 

As an example, it is generally a challenge for ag producers to track and trace raw materials once they hit the processor (both primary and secondary). In food value streams like protein (animal) processing, automation and batch processing are hard to achieve given the nature of tracking disassembly (“primary” – one carcass that turns in hundreds of cuts or many SKUs) vs. assembly (“secondary” – a dozen ingredients combined into one product or SKU). 

However, increasingly sophisticated and connected MOM systems are beginning to deliver batch-level tracking which makes verification of farming practices (regenerative, non-GMO, organic, etc), genetics / genealogy or origin claims easier to authenticate.  

This is one of many examples that reinforces our belief that domain-specific manufacturing software and systems for the food and beverage sector are essential. The level of tracking complexity and data integration can be dizzying, but there are a handful of innovative companies that are building solid, scalable businesses such as Dairy.com, ParityFactory, Wherefour, and Food ID, among others in the space. 

The Cold Chain is Heating Up

As noted in The Spoon’s coverage, the pandemic shifted a large number of people to online grocery shopping, and many of those new online shoppers will continue to shop online. Notably, this surge in digital grocery orders also included more online fresh / perishables purchases, both in retail environments as well as direct to consumer (D2C). This growth is expected to continue even as grocery shoppers migrate back to in-store shopping. For context, e-commerce grocery is now expected to account for at least 21.5% of US grocery sales by 2025, (up from a pre-Covid prediction of 13.5%). 

We believe this increased demand will catalyze cold chain suppliers and 3PLs to meaningfully bolster their digital infrastructure and investment in tech solutions, as we have seen with high flyers like Lineage Logistics. They will feel greater pressure to adapt to the dynamic demands of buyers, such as faster speed of delivery, decreased waste, real-time inventory visibility and traceability of products. 

These objectives are not possible without integration and interoperability solutions which create the linkages necessary to overcome the massive amounts of existing siloed data. These solutions layer on top of existing supply chain planning, execution and equipment control systems, integrating them to further optimize for analysis and real time planning / visibility across various parts of the supply chain. 

Without harmonized data, the cold chain can’t truly unlock efficiency or capacity, nor adequately respond to supply-demand volatility. Tightly linked systems to share this data can have a significant impact on the shelf life of perishable products (reducing waste), the assurance of quality (product, producer or marketplace differentiation), and support agility in demand-driven forecasting. Examples of startups focused on providing innovative solutions in this sector include AgroFresh’s Fresh Cloud, Backbone AI, and Afresh.

Looking Ahead to 2021 

The food supply chain differs in some respects from our traditional understanding of Food Tech and AgTech because it encompasses industries with relatively well-established players and technologies, many of which are horizontal software (with a multi-industry offering) and logistics companies. Due to this, as well as the highly-regulated and labor intensive nature of the supply chain, historically it has been a more difficult industry for nimble start-ups to penetrate. 

Today, we see the majority of participants across the food supply chain setting the table with foundational data and digitizing basic workflows. This is the essential first step. Basic digitalization, strengthening collaboration tools, automating some data sharing, and looking for ways to streamline labor will be key themes in 2021.

To be sure, COVID-19 revealed accelerating demand for tech ready to scale (vs. new innovation). Yet that is not the end of the story. We see most of the exciting food supply tech innovation springing up around the perimeters of the landscape, particularly from analytics and strategy plays within First Mile (Supply) and Retail / Food Service / D2C (Demand).

For start-ups, those that can differentiate themselves with proprietary, unique data cleansing tools have an important edge. As we know from AgTech and Food Tech, this is one of the principal activities that many innovative companies spend vast amounts of time working on. The same holds here in the Food Supply Chain.

———-

Seana Day and Brita Rosenheim are Partners at Culterra Capital, and Venture Partners at Better Food Ventures, each with 20+ years of investment, M&A, and strategy experience within the food, ag and tech verticals. Their analysis on the Agtech and Food Tech sectors are regularly used by participants in the space to understand the quickly evolving landscape.

December 30, 2019

Will 2020 Be the Year Truly Personalized Food Becomes a Reality? (Sort of.)

You’re almost certainly already used to customizing your food to some degree. Maybe you get extra guac at Chipotle, or leave off the mayo on your drive-thru burgers. You might even use platforms like Innit to easily substitute ingredients when cooking at home.

But the era of truly personalized food — exactly what you want (or need), and nothing you don’t — has yet to come. And advancements in AI, data, and food science are helping us get there.

2020 is the time for personalization to mature and become more than just a gimmick. I see a few high-potential spaces in which personalization has the opportunity to really grow over the next year (or two): drive-thrus, sit-down restaurants, and dietary guidance.

When it comes to personalization in fast-food, McDonald’s is the clear leader. Earlier this year the QSR giant acquired Dynamic Yield, a personalization platform which it’s using to tailor menu recommendations based off of things like weather, time of day, etc.

But what Dynamic Yield brings to Mickey D’s isn’t real personalization, per se. The software can customize menus based on external factors— if it’s cold out, maybe you’d like a piping hot cup of coffee? — but it doesn’t pull from customer data to create menus actually drawn from individual preferences, dietary restraints, or allergies. And as the Spoon founder Mike Wolf pointed out earlier this year, true menu personalization is the holy grail for dining establishments.

That holy grail might be closer than we think, however. Startup 5Thru‘s tech will scan people’s license plates to access their past orders, which it uses to suggest your favorite foods. KFC is testing out similar tech. The fast-food space in general is investing heavily in personalization, so I wouldn’t be surprised if we see lots of individual players accelerating their efforts in 2020 to try and smoke the competition.

Non-fast-food restaurants are also trying to leverage personalization to improve the consumer dining experience (and, you know, sell you more stuff). Suggestic and THE.FIT are developing tools to generate personalized versions of restaurant menus based on consumers’ dietary goals and restrictions. That sort of customization also extends to in-restaurant experiences; this year OpenTable and Upserve partnered to share guest data so restaurant employees can have pre-warning about their preferences, allergies, etc.

As these sorts of tech become more commonplace and affordable, restaurants will only get more personalized in 2020. I’m betting over the next twelve months that in-restaurant menu customization apps like Suggestic and THE.FIT will become, while not commonplace, at least more widely available. On the digital search side I could also envision Google Maps, which already surfaces restaurants’ most popular dishes during searches, displaying customized sample menus based off of your customized dietary profile.

2020 could also be the year that personalized nutrition becomes more mainstream. Viome and GenoPalate already create customized food and recipe recommendations based on your microbiome and DNA, respectively, to help fight preventable diseases. As these technologies become more widespread and affordable, we might even see these services integrating with restaurants to help you see which menu items best suit your diet and/or avoid triggering foods.

True, that might not happen in the next twelve months. But we will no doubt see more vaguely customized products like Nourished, which creates individualized 3D printed vitamins. That sort of generalized personalization also extends to things like baby food and wine delivery. While these offerings are based off of broader markets like age and preferences, not data as granular as your microbiome makeup, they indicate a real effort by companies to take a step in that direction and offer customized CPG products, typically delivered right to your doorstep.

It’s also worth acknowledging the potential pushback against personalization. Creating things like highly customized menus and restaurant recommendations necessitates massive amounts of personal data, which could have frightening consequences if that data gets hacked. Despite those risks, I have no doubt that companies will keep pursuing the personalization trend into 2020 and beyond.

That said, we’ve got a ways to go until we reach a truly personalized dining future. I don’t think that by December 31st, 2020 we’ll be able to go to a drive-thru and see menus sporting all of our favorite dishes thanks to info it gleaned from your dietary profile. But it might remember you love the Buffalo sauce with your chicken nuggets — and that’s a start.

We’re so interested in the potential (and challenges) of food personalization that we created a whole summit around it! Join us at Customize in NYC on February 27th — Early Bird tickets are on sale for a few more days.

November 1, 2016

Interview With the Greats: Dave Arnold on Innovation in the Kitchen

Dave Arnold never stops. The fortysomething owner of Manhattan cocktail bar Booker & Dax is exactly the kind of madman inventor that we need to push the food world forward, and lucky for us, he’s always working on a cool project. Even luckier, he always wants to tell you all about it.

Arnold is also the director of the Museum of Food & Drink in New York City, the host of Heritage Radio Network show Cooking Issues, and the author of Liquid Intelligence: The Art & Science of the Perfect Cocktail. He’s inspired an entire generation of chefs to innovate with technology in their search for ever better food and drinks, with wacky inventions like the Searzall blow torch for your steaks and milk-washed spirits for your cocktails. (And he’s working on a centrifuge for restaurant and home use!)

We sat down with Arnold a few weeks ago to talk shop about the future of food and technology. Here’s an abbreviated version of our conversation.

TheSpoon: Do you see a difference between technology for professional kitchens versus for home kitchens?

Dave: One-hundred percent. It can go both ways. In a professional kitchen, if something’s accepted, people will learn how to use it, because they have to. People in professional kitchens put up with things that you’re not allowed to sell to people at home, things that are very hot or very large or take a lot of energy.

The problem with restaurants is that chefs are extraordinarily busy, and they don’t trust that every one of their employees is a rocket scientist. So stuff in a restaurant has to be fairly intuitive to use and bulletproof. It has to withstand intense abuse. That’s why if you take off the label that says Vitamix and put on one that says Vitaprep, the price goes way up and the warranty goes way down, because everyone knows that in a commercial establishment, people beat the heck out of things. Commercial equipment needs to have a level of robustness and intuitive use that is not necessary for home equipment.

But home equipment — it depends on who you’re shooting at. When you’re shooting at people who aren’t avid cooks or who don’t cook that much, it has to be intuitive at home in a different way. It has to have a lot more convenience and bells and whistles on it. It has to polish out nicely, to tell you when your breakfast is done. Also, most home equipment is built around maximizing kitchen space, which is super important commercially as well, but typically home people don’t have to put out as much product out of a particular square footage. You’re maximizing a different problem.

Where it can get interesting is, you can have something that home people can experiment with because maybe you can’t make that much of it, so it’s hard to do in service because the product takes too long or maybe it’s a little too complicated to train everyone on. So things that I can do at home better than in a commercial kitchen? Rotary evaporation. It’s illegal to do rotary evaporation in a commercial kitchen because you’re doing distillation. But at home you’re dealing with a tinkerer. Someone who sees themselves as a learner, a hobbyist. There’s a weird sweet spot there for home people to do interesting things that are difficult to do in most commercial restaurant environments. Because as much as commercial restaurant environments are creativity driven, it’s business, and it’s hard to justify the cost of building in super-high levels of creativity.

Molecular Cocktails from Booker & Dax with Kate Krader and Dave Arnold

Molecular cocktails from Booker & Dax with Kate Krader and Dave Arnold; photo courtesy Flickr user Meng He

TheSpoon: Let’s talk about that creativity.

Dave: In the wake of the popularity of the Spanish style at El Bullí, there were a bunch of people who had positions in higher-end restaurants as research chefs. Not the way Chipotle would have a research chef; it was specifically for fine dining. I don’t really know how that trend is doing now, but it’s hard: Customers’ interest in visibly creative stuff goes up and down. Everyone always wants something to be different and new, but sometimes they want it to be different and new in a way that doesn’t look like people have been hypercreative with it, and sometimes they want hypercreative.

Look at the mid 2000s , with WD50, Alinea, Moto: All over the country a lot of the new techniques were being used and pioneered by restaurants that weren’t advertising that that’s what they were going to do. Modernist Cuisine is fairly good at documenting where a lot of these recipes came from. You can treat it as a library of where these ideas came from.

Even Michael Laiskonis at Le Bernadin was using hydrocolloids a lot. Dominique Ansel at Daniel, Greg Brainin at Jean-Georges. All the cooks who went there were smart people interested in these new techniques because they knew it would allow them to achieve something different, new and good. None of those folks were using it in very obvious ways that said to the customer, “This is using a new technique.” That’s what I mean by the hypercreativity isn’t always obvious.

When it is obvious, and people are actively trying creativity that way, there tends to be acceleration of what happens. People push the boundary faster and harder, make more mistakes frankly, so you try 10 things that suck and come up with 1 good thing. If you can do that you’re super winning.

TheSpoon: Right now with connected kitchen appliances it seems like everyone is trying way more than 10 things. How do we move away from gimmicks into useful technology?

Dave: I have a particular opinion on this. Ninety-nine percent of the applications that people are positing today will be the future, are not the future. If they are the future, God help us. It’s so dystopic that would someone would print your meal out. It’s a horror show. Luckily I don’t anticipate you ever pushing a button and it printing whatever paste it has, applying food coloring to it to make it look like a hamburger, and then you eat it.

The current printing technology is either working with liquids (in that case it sucks because you need your viscosity to be right), or you’re dealing with paste that has to be extruded through a very fine nozzle. There’s only so much you can do with current technology.

True, that technology will change and get better. Let’s say someday you could find what you think is going to be the best-tasting pig and then recreate it a million times with a transporter beam where you store the information and keep recreating it over and over again. Or maybe it’s the best meal ever. It would be like a CD player of meals: You could have your favorite chef create it, scan it, and then whenever you want, you could just have it. When you get to that level, sure, print me some food.

The issue isn’t that the current technology sucks (which it does) or that the way people are using the current technology is wrong and bad (which it most certainly is). All that’s important is that you push the technology. Someone will find a good use.

Look at the development of almost anything: Steam engines sucked for a while until someone got one that worked right. You need to have the person who has no idea what’s going to happen in the future just work. They need to work and make stuff and throw stuff against the wall and see what happens: Push technology, create. Eventually someone will do something amazing.

Searzall_FlickrArnoldGatilao

The Searzall in action; photo courtesy Flickr user Arnold Gatilao

We all have to play this game. Well, I don’t tend to play it, but most of us play it, where we pretend that the gimmick idea is reasonable when we all know it’s not. Of course it’s not reasonable!

Remember when they had the first car phones? If you had said, “That’s dopey, who the heck is going to use that?” we’d never have what we have today. Or as I said when I was a teenager in the 80s and somebody showed me email and I was like, “That’s not ever going to go anywhere.” Who knows? That person was wrong about why it was going to be great. The person who showed me had no understanding of how the technology was actually going to change the world, but they just kept at it.

TheSpoon: Are there certain food-tech trends that you’re excited about?

Dave: There’s stuff that I thought was going to have a lot of potential for a long time and never has. If you’d asked me over 10 years ago, I’d say by now almost everything would be completely traceable, RFID and that safety would be on lockdown and that we wouldn’t have recalls and all of this other nonsense. Once everything is traceable that way, I’d assumed we’d already be in a situation where — and we’re getting there — your grocery list would be more integrated with what you’re doing.

I didn’t expect FreshDirect and Peapod and all that to make as big a dent as it did, in the same way that I didn’t understand how the whole retail world was going to get flipped by Amazon the way it did 10 years ago.

Especially because in the late 90s, there was Urbanfetch. I was like, “Oh yeah, this is never going to work. You’re going to be connected on your computer and someone’s going to go show up in half an hour with your ice cream.” I used to mess with them. You weren’t allowed to tip them and they had no minimum order. So I was like, “It’s 4 AM. I’m going to hit this button, and you’re going to deliver me a pack of gum in half an hour?” The guy’s like, “Yes.” And they showed up with the gum and I’m like, “And I’m not allowed to tip you?” He’s like, “Nope.” And every time they were late they’d give you a free pint of ice cream. It’s a crazy business model. They were losing money, but that was back when people thought it was okay to lose money as long as you lost it in very large quantities. That was a sign that wasn’t going to work. That means someone comes along and does it right, like FreshDirect.

Here’s another situation where I was totally wrong. Who’s going to order vegetables off of a website? Turns out everybody, except me.

Most of the time, on these kinds of predictions, I’ve been wrong.

The only time I’ve been right — I predicted low-temperature sous vide cooking is going to grow and it’s here to stay. And that people will be interested in the why of cooking. It’s not a fad. The general trend is toward deliciousness. I think I’ve been proved right on that.

September 1, 2016

A Conversation With Darren Vengroff (Full Transcript)

Michael Wolf: Hey, we’re really happy to have Darren Vengroff, the Chief Scientist from Hestan Cue Smart Cooking on the podcast. How are you doing, Darren?

Darren Vengroff: I’m doing well. How are you?

Michael Wolf: Great! We saw you a couple of weeks down in San Francisco Williams-Sonoma headquarters. You were on a panel. You came down for that. Brian Frank, who’s a really smart guy, was interviewing you. It’s interesting his first question. He goes, “What is a scientist doing in the kitchen?” I thought that was great. What is a scientist doing in the kitchen?

Darren Vengroff: Yeah, so well having a lot of fun first of all. But no I think it’s a great question and the interesting part of it for me is that for your average everyday person whether they’re scientists or not or particularly if they’re not, the kitchen is actually where they probably do more science than just about anywhere else in their daily lives. There’s chemistry going on in just about everything you cook and how different molecules interact, how heat affects them. There’s physics and how the heat moves through things and how all the various cooking process work. There’s biology coming in as soon as we’re talking about bread or any sort of fermented product really of any kind, you know the pickles in your fridge.

There’s really a lot of science going on in putting together meals day in and day out and I think what we’re really trying to do is let’s understand some of those processes a little better. People have been researching these processes for years, but let’s try and understand them in a way that will enable us to help people cook better meal for themselves. That’s really how we approach it here and sort of the end-result, the end-goal is always not the science itself so much as how do we make a delicious healthy meal at the end of the day.

Michael Wolf: We first met when I’ve read of a company called Meld, which was acquired and we’re going to get into that story, but I want to work up to it because I think it’s an interesting one. I’ve heard you tell. I’d love our audience to hear it. But I want to go back further because I think you’re one of the few people that’s uniquely positioned to talk about why ‑ we’re both here in Seattle – why we have this market [unintelligible 0:04:40] in Seattle, the modernist cuisine movement, you’re kind of there early when you were working there with eGullet, and there was kind of this little hotbed of interest around something sous vide. Talk about those early days because you’ve been in tech but then you also have this interest in cooking and talk about the early days of eGullet.

Darren Vengroff: Sure, yeah. eGullet in the early 2000s was this website that was – websites back then weren’t quite what they are today, but it was a discussion forum where people who were interested in food from any variety of angles could kind of get together and talk about things. It is still around to this day. It’s actually a nonprofit foundation now running it. But the idea was people who were interested in food, whether they’re diners who are interested in what’s going on in restaurants, or they’re chefs who are working in those restaurants, or they’re home cooks who are interested in learning more about how to cook various things at home or even just bragging about the things that they’ve done. There were big different cook-offs and things where everyone post pictures of what they’ve done.

This really incredible community kind of developed in and around the site including people who maybe weren’t household names back then but are today, so you could see people like Grant Achatz, who is very well known chef in Chicago at Alinea. He was there. People who were all over TV and other media, Richard Blais early in his career. At some point, there was a guy named Nathan, turned out to be Nathan Myhrvold, who was getting involved in some of the conversations, and he was interested in this new technique called sous vide. There were several others of us who were openly interested in it. I think there was more interest than actual experience at that point. You sort of either had go and buy laboratory equipment that hopefully nothing too toxic had get in ‑

Michael Wolf: Yeah, yeah.

Darren Vengroff: Before you went and bought it on eBay. You could sort of rig up your own things and there are some people doing that. There was one book available about sous vide that was in Spanish. I think Nathan actually had it translated, so he can read it, but we started talking about all these things and what could and couldn’t be done. There’s a famous, or at least by eGullet standards, famous thread that’s still there to this day where Nathan started asking about times and temperatures and at some point, he decided, “Well, I’ll go do some additional research and maybe even put the results into a book.” Well we sort of all know what happened, he ended up not just writing a book about sous vide but going much deeper and broader.

Michael Wolf: Yeah.

Darren Vengroff: That led to a modernist cuisine set of books. It was a really interesting time back then and it’s particularly interesting to look back now and see where some of these people are today and what they’ve done since.

Michael Wolf: At the time, looking at this I think this evolution I think of precision cooking, which I think sous vide is a big part of that and I think along that same line Meld is and then what you’re doing at Hestan is as well. But during your career, though, I think this was the time I think you were at Amazon, so you were working at least immediately after that you were working in Amazon, so you were working in software development along this way and you never lost interest in this idea kind of science in the kitchen. Talk a little bit about your career before you got to Meld.

Darren Vengroff: Sure. Again through this interest in sous vide, and sort of having a technical background and having done a fair amount of software to simulate various processes. I kind of decided it’s great that people are doing a lot of experiments and figuring out okay the time and temperature for different things. You can do experiments and evaluate hundreds of different scenarios, carefully measure things, and temperature and thickness of the steak or chicken breast or whatever, or you can do what sort of modern engineering practice does, which is you say, “Well, instead of doing 100 different careful experiments, if I can build a software simulation of how a process works, I can try out millions of different combinations. In fact, maybe there are millions or trillions or more than I could ever even care about or run, but if I package this up just right, anyone who has a particular scenario I’ve got a steak, it’s exactly the steak, I want medium rare could run a simulation and they would say set your circulator for 54.4 degree Celsius and put the steak in there for 57 minutes or whatever the appropriate number was.

Again on the side, this was kind of a hobby. eGullet was the same thing. it wasn’t my fulltime job. I wrote some software to do that. Around that time, well we’re all carrying around these smartphones and tablets now that they’re actually powerful enough to run these simulations and so I wrote an app called SousVide Dash where you could do those things I just described. You could say I have chicken breasts and it’s 1-inch thick, and what are the recommended cooking time and temperatures.

Then we went beyond that and sort of added other features like a model of pathogen. At the time, health departments were super concerned about people using this low temperature cooking in their restaurants. The idea was you might be growing bacteria in this thing; in fact, in the laboratory down the street, it’s actually been used specifically for that purpose running it at different temperature and different conditions of course. And so we added a pathogen model that would show how different bacteria either grew or were destroyed at certain temperatures much more elaborate model than this sort of real basic health department guidelines of in this temperature range for this amount of time. Instead, we actually modeled it at discrete temperatures and what would happen. The app plotted all these nice curves that then people in restaurants could show to the health departments and convince them that what they were doing was actually safer than the sunny-side-up eggs at the diner down the street that the health department hadn’t cared about in years.

From there, I ended up connecting with Christoph Milz, who was at PolyScience at the time in their culinary division, so they had always produced laboratory circulators and had been doing so for many years. Philip Preston, who was running the company, was very interested in cooking as a hobby, sort of in the same vein that I was, went a step further and actually adopted some of these devices, worked with some chefs, and got them in. anyway, we got the other and did a version of this app with them. That was quite successful. It was exciting for me because it wasn’t a full time career but it was a hobby that paid for itself essentially.

Michael Wolf: This was around 2010 and this was at the time when PolyScience was coming out with really kind of the first circulators. Like you said, they kind of made targeted devices preferably to use it for cooking purposes rather than in a lab somewhere, right? I think [unintelligible 0:13:36] right then, but this relationship with PolyScience turned out to be critical later in your career, and we can get to them a bit where Meld ultimately ended up at Hestan. You were with Spot Dash and you were also RichRelevance, right? That was kind of your main day job?

Darren Vengroff: That’s right, yeah.

Michael Wolf: And so ultimately, you were working. You got together with a guy named Jon Jenkins, who we all know as JJ. You met him at I believe when you were at Amazon, right? He ended up running product over at Pinterest but you guys decided to get together again.

Darren Vengroff: Right, so we had known each other for 10 years or so going back to our time together at Amazon and personalization there. Like you said, he ran the engineering team at Pinterest for a while. He was interested in doing a startup of his own. We had talked about various startup ideas over the years and some of them were probably really good ideas we should have done, some of them were probably terrible ideas that I’m glad now we didn’t try, but we got together and this was now about 2-1/2 years ago.

I started with this question, “Well, if sous vide can offer this level of temperature precision and be great at the things it’s great at, cooking steak and sous vide is great, it’s a terrible way to make a grilled cheese sandwich, right? It’s not built for that. There are many different ways of cooking and each is good at what it’s good at and terrible at what it’s terrible at. We kind of thought, why is sous vide the only method that has this level of temperature control and what would it mean to bring it to other forms of cooking?

We started this company and we ended up calling it Meld, and early on we really again going back to the scientific side, we really just started investigating some of these questions. You’d look on the Internet and you’d see things, millions of recipes and cookbooks.

Then they all say something like, “Okay, put a pan on medium, right?” What does medium actually mean? And so we hacked up a pan that we invented some temperature sensors in, and we took it around to different stoves and set it on medium, exact same pan, and let it come to temperature. What we found is depending on which model, which burner you used, medium varied by 200 degrees Fahrenheit to 300 degrees Fahrenheit.

Michael Wolf: That’s huge, by the way.

Darren Vengroff: That’s huge, right.

Michael Wolf: It’s crazy.

Darren Vengroff: What that means that you and I could follow the exact same recipe, do every step by the book perfectly, both put our pans on medium, and yours would be burned and mine would be raw and neither one of us would be happy about that, right?

Then our next step was we said, “Well, what if we could hack up this pan we’re measuring the temperature? What if we tell people your pot is too hot or too cool and they could do something about it?” And so we did that and we found in user research that people would turn it up and they’d overshoot. They’d turn it down and they’d go back and forth and they would eventually get to the right temperature, and over time they’ll get a little bit better at it. But overall, the biggest feedback we got was, “You just showed me how terrible a cook I am and gave me tools to do anything about it,” right?

That’s when we realized just like in sous vide, it’s the feedback loop that makes all the difference and so if we could get that temperature transmitted wirelessly to the heat source, to the stove, we could actually then adjust the heat. You can’t adjust temperature on say a gas stove but what you’re adjusting when you turn the knob is the rate at which heat is being added by the flame.

And so we also knew that people only buy a new range every 15 years, so that’s a long product cycle for a startup, and so our solution was to do an add-on that would let you control the temperature with a knob. You take the knob off your stove put ours on. It had a little motor in it. It had a little microcontroller to run the algorithms, and it can wirelessly talk to the temperature sensors in the pot or pan.

Michael Wolf: There’s two things I thought were interesting about Meld. One I’m a big fan of retrofit solutions in the connected world. If you look at all the waste like the Nest Protect smoke alarm, if you want to like retrofit all your smoke alarms, you’d throw in all the smoke alarms into the trash, which goes into landfills, and big iron things like stoves, you can’t just replace those very easily, right? Then so this was good. We talked about early how sous vide was one of the first steps in this idea of precision cooking and you kind of talked about it here, I felt like this was a next evolution. We’ve seen them.

We can talk a little bit later in the podcast about this explosion in things like what you’re doing with Hestan and what you’re seeing in things like this Pantelligent and the software cooking services, stuff like that. I think that’s an interesting conversation but I love for you to talk about like the story here because I think it’s fascinating when you were working on this and ultimately this relationship you developed with PolyScience and Christoph ended up playing a very critical role in what happened with the company.

Darren Vengroff: Right, so at some point last year, Christoph was aware of what we were doing. We continued to be friends over the years, and he called me up and he said, “Hey, I’m doing some consulting for Meyer,” which is a very large company that makes cookware under quite a wide variety of brands. People don’t necessarily know the Meyer name but they know the brands of their cookware. They make everything from the world’s number one cookware ‑ Anolon, Circulon, things like Rachel Ray, some high-end really nice cookware under the Hestan brand, so a very wide variety of things. He said, “Stanley Cheng, the CEO of Meyer, would like to come up. I’ve been talking to them and would like to come up and see what you’re doing.”

And so, I said, “Sure, great.” This was on a Friday afternoon. They came on Monday. We gave them a little demo of what we were doing. It was interesting. It was Christoph, whom I had obviously known for many years, Stanley Cheng, the CEO of Meyer, and then Philip Tessier, a chef who I have heard of but I have never met before who actually worked for Thomas Keller at Per Se and The French Laundry and had represented the US in the Bocuse d’Or competition, which is kind of the culinary Olympics, where he won silver in the year before, which is the best the US has ever done. He now coaches the team. But anyway, to have him in the kitchen kind of seeing what we’re doing was slightly intimidating. I think you’ve actually ‑

Michael Wolf: We had talked about intimidating in the podcast actually. I had a cook-in in front of Philip, so yeah that is intimidating. It’s like playing basketball in front of a Michael Jordan basically.

Darren Vengroff: Right, right. But he’s a fantastic guy.

Michael Wolf: He’s a great guy.

Darren Vengroff: Yeah, a pleasure to work with absolutely. Anyway, we talked them through, answered a bunch of questions, and to make a long story short, we shared a lot of common ground on the vision of where smart cooking and what we now call guided cooking was going, and we decided to join forces and Hestan Smart Cooking is the result of that.

Michael Wolf: And it was interesting because you guys had a successful Kickstarter and I was excited about the product, but you pulled it back. You gave everyone their money back, which was an interesting thing because that often doesn’t happen like a successful campaign but you guys went in a different direction, which we can talk about, but was that an interesting day you decided to give the money back to your Kickstarter backers?

Darren Vengroff: Yeah. I mean it was a really tough decision. I mean we wanted to be very careful about it and I think we made the right decision. We gave the money back. Clearly we did not want to go the way of some of the other big name Kickstarters where people have actually not only not got the product but never got their money back and sort of the whole ship sank. We weren’t going down that road. We I don’t think at any point we’re even near falling off the path, but we wanted to make our backers whole on supporting this. I mean I owe them tremendous thanks even to this day for what they helped us do. We gave their money back and we’re discounting new product to them as well.

Michael Wolf: Which puts us to where we are basically today. It’s a secret thing you guys got acquired. I was like what happened to Meld and you and JJ kind of talked about it but you kind of had a coming-out party I think in March when you guys went to Housewares. That’s when I was in Chicago, and I swung by at the Meyer booth and that’s when I got a cook in front of Phil Tessier with this Hestan Cue smart cooking system and we couldn’t describe it quickly. I mean you probably do a better job than anybody, but I saw this system that help me guide my cook with some visual guidance. We had a nice app. He had Bluetooth connect the pan and this induction heating system, and I actually made the best salmon I’ve ever made. I’m like I usually don’t do very good with fish. Of course having Phil there helped a little bit but what did you guys ultimately come out with. Tell everyone what Hestan Cue is.

Darren Vengroff: Yeah. Great. We’ve been talking a lot about temperature control, and temperature control is a great way to help people be better cooks. I think layered on top of that though is this concept of guiding, which I think is critical in helping build confidence and helping people essentially leveling up their games, so what we have in the app we think of it as sort of a GPS for cooking is the analog.

There are a bunch of recipes to choose from. That’s like deciding where you want to go, and then once you decide where you want to go, I want to cook that salmon recipe, then it guides you step-by-step, and I think the key thing is it’s literally every step from the prepping to the plating. If you don’t know how to chop an onion, there is a video there that shows you how to chop an onion, how to dice it, or whatever you may need for this recipe. You go through it step-by-step and when you get to a step, which in a normal recipe or an old-fashioned recipe would say put the pan on medium, well it says the pan on the induction burner and you do that. Then it says warming up the pan, and you get a little progress bar and it shows you when the pan is warm. If it’s going to have to go to a pretty high temperature, we may save a couple of prep steps so you can keep doing those prep steps while it’s warming up, so you don’t waste a lot of time.

Then once it gets to temperature, it will hold it at the right temperature and tell you, “Okay, now, now it’s time to add a tablespoon of oil or now add the onions or put the fish in skin side up,” whatever the appropriate thing is. It will then manage the temperature so you don’t have to, but you’ve done the various other steps of the recipe and it’s guided you through them all.

It’s sort of giving out that guidance and also giving you that confidence because you know when you get to the step where the fish hits the pan. As you experienced in Chicago, it’s going to tell you to do the right thing. It’s going to tell you when to turn it over. It’s going to adjust the temperature appropriately and you’re going to end up with that nice crispy skin and the tender moist interior that when you go to a good restaurant who knows how to cook fish, that’s what you get. When someone like Phil Tessier cooks fish, that’s how it comes out. He knows what he’s doing. Most home cooks don’t cook fish often enough and don’t have the skill to produce that resulted and are intimidated and afraid and won’t try it, but this gives that guidance and confidence and sort of guaranteed results.

We had a bunch of people come through in Chicago. We didn’t do kind of the classic trade show demo where you have a chef standup and demonstrate the cookware and then hand out those samples. We actually let people cook for themselves and I think it was a much better presentation of the power in the future of this kind of guided-cooking approach.

Michael Wolf: Yeah. I would say anyone who’s creating a product like what you guys did there, it was powerful for me, and I think it’s just a good way to approach it. I mean I came on a piece about it and this idea like I saw this thing. I called it guided cooking or guided-cooking system because it was this combination of obviously precision cooking, but I thought it went beyond precision cooking because there was a guidance system and that GPS was a good analogy there. But when you take the combination of high-precision to very precise cooking were on heat, you have this guidance system with regard to like the visual guidance whether that’s an app like you said all the way from prep to plate.

The combination of like the Bluetooth pan as well as the induction heat system, all to me like you couldn’t name one just appliance. We’re so used to doing like with housewares and small appliances just pointing to like one thing, I don’t think you could do that. The system word I think is appropriate here. I kind of rolled like I think we’re seeing the rise of like a new category and I think you guys would agree.

Darren Vengroff: I agree.

Michael Wolf: And is this the heir apparent for like sous vide or just kind of one of the line? I think it combines a few different things and it’s not just one device. What is this here? Is it an evolution or something?

Darren Vengroff: Yeah, I think what you’re getting at with the system, with the idea that it’s a system is kind of the key. The three main components again like you said there is the app with the guidance. There is the cookware with the embedded temperature sensors and the ability to communicate over Bluetooth, and then there’s the induction burner, which can communicate over Bluetooth as well and adjust the heat and power level accordingly.

I think if you had anyone of those things by itself or even any of those, you’re nowhere near what you have with the three put together. That’s how we will sell the system when it comes out as a package like that to get you started. I think once you have that system obviously, you can expand upon it and you can potentially add new things to it that work within the context of the system, but I think you’re absolutely right. The way people cook, they just don’t cook with one thing, right? They cook with a combination of different tools that are in their kitchens. Bringing the right tools together in the right way I think makes a tremendous difference.

Michael Wolf: It’s modularity to a degree. You guys have the base of the pan, but you also have like base of the pot. I think there can be ultimately a degree of modularity, depending on what type of cooing you’re cooking. You might have water. You might just be frying something, and I think that modularity is an important component to it.

Darren Vengroff: Yeah, absolutely. We support a variety of different variety, both wet and dry cooking modes, some really cool things actually you can do in the pot that we’ll be talking about in the not-too-distant future. But there is some really interesting stuff that we’re doing there in our test kitchens that we’ll sort of be revealing soon. But I think you’re right. It’s modular and it’s extendable, and I think it’s not it slices and dices. This one component does everything. I think again going back to where we started in sous vide and where we are now with this, it’s this recognition that certain tools are really good at certain cooking techniques and terrible at others. Let’s take the best of the way people traditionally cook or people with a ton of skill traditionally cook and some of the pieces that will let people up their game.

Michael Wolf: Why is it – here’s a bigger question and it’s around a piece I’ve been thinking of writing and I’m curious to get your opinion because I think I see an opportunity here. I feel like this is an interesting category and there’s other new categories. If you look at the broader food tech world and like maybe this is in your area of expertise, but just be interested [unintelligible 0:32:52] the money in investment when you look at companies that follow the steps, the vast majority of it has been around delivery. When you start to kind of look at the food tech investment like ‑

Darren Vengroff: Sure.

Michael Wolf: Things like plated and those types of services, Blue Apron, the bulk of that but I see like an equally potentially big opportunity in this reinvention of the kitchen because that’s where everything happens. Sure there might be like a big component around delivery, it’s fairly low margin. Ultimately, I think these things are tied together I think what’s interesting is this idea of subscription and delivery tied together with connected devices in interesting combinations. Do you think that it’s an underserved area right now in terms of like people looking and investing in like reinvention of natural cooking systems?

Darren Vengroff: Yeah, I do. I mean I think the food delivery in its various forms ranging everything from fairly raw ingredients.

Michael Wolf: Chopped.

Darren Vengroff: But then you have the chop yourself pretty close to ready to pop in the oven meals. That will continue to be big, and I think the guided cooking though, the ability to cook at home, whether you want the items at a grocery store or whether you have them in the fridge or whether they came from Blue Apron or service like that where the recipes were integrated with them, I think that creates a tremendous additional value. And to come back to sort of your higher level of question why there has been maybe less investment in the kitchen itself or the tools that are used for the cooking, I think there has been this kind of rush to connect with things as opposed to sort of a careful study of how we cook and how we could cook and what might be better or worse.

I mean going back to the idea of connected versus smart, connected means, okay my toaster can talk to the Internet. What exactly does that for me as a consumer of toast actually got me. Yeah, it means I wake up in the morning. I come into the kitchen. I say, “I wanted some toast, but I left my phone charging in the bedroom. Let me go back and get it. Okay, got my phone. Where’s my toast app? Okay, select medium. Push the button. Drop the bread.” Versus today’s UI on my toaster is I put the bread in and I push the button and what you’ve done is connected my toaster and made the experience worse.

And so I think starting at the other site, starting at how do people cook and what variation of techniques they’re using could or what techniques could they do that they’re not doing today by and large at home if they have the right tool for it, and then what’s the science and technology and connectivity and digital logic that can create that experience for them versus Wi-Fi chips just get getting cheaper so I should put one in everything.

Michael Wolf: Yeah. I agree. I think like stepping back and taking it from the other direction and that’s why we have a scientist in the kitchen like yourself, so I appreciate you coming on, Darren, and talking about what you’re doing and why is a scientist is in the kitchen. It’s been a great conversation. I think this journey that you had obviously I’ve used this for like you’ve kind of been like a Forrest Gump. You’ve been to a lot of historic places of this evolution, and I don’t mean to insult you by calling you Forrest Gump, by the way.

Darren Vengroff: No, I’ll just keep running down that road [laughter].

Michael Wolf: Hey, Darren, this has been great. Thanks, man.

Darren Vengroff: Yeah, thank you very much. It’s a pleasure to be on.

August 8, 2016

Interview: Chef Chris Young, Co-Founder of ChefSteps

Ashley recently chatted with Chef Chris Young, famed chef-scientist, co-author of Modernist Cuisine and co-founder of ChefSteps, a technology company working to help people cook better.

Ashley Daigneault: How has cooking evolved over the last few decades and what role do you think technology is playing in those changes?

Chef Chris Young: Well that really depends on how you define cooking – in the commercial kitchen, technology drove the modernist movement in the late 90s and 2000s, where chefs were leveraging technology and a scientific understanding of cooking to create novel dishes, things that people never ate before. Technology drove innovation in the kitchen.

Some of that has trickled down to the consumer level, but a small amount. Sous vide is a good example of this – a device really borrowed from the laboratory from professional chefs. The other way technology has changed is not in cooking but in eating is the rise of mobile devices and apps – the ones that help you find a restaurant, choose the food you want to eat – technology has made it easier than ever to NOT cook. Between meal delivery service, Uber delivering food, Yelp-type apps, in the last decade, technology has done more to disconnect us from cooking.

Ashley Daigneault: What innovations happening around the kitchen have the best chance of becoming mainstream?

Chef Chris Young: The microwave is the last big technology that became a mainstream consumer product. It came out around 1968 and then in the 90s they were finally in every kitchen; mainstream has a long lead time. You’re talking two or three decades. Now we’re seeing the rise of gadget cooking, like sous vide cooking – but the interesting thing there isn’t the water bath or the immersion circulator, but the way mobile phones, content and community are making it easier for people to connect and cook.

The devices that succeed are ones that are more responsive to humans; we’re still going to eat hot food – what will change is how we interact with the devices doing the heating. You should be able to say – I want to cook this certain thing, this certain way and I’d like to eat it at this time – and that would trigger a whole series of actions behind the scenes in your appliances. Human interaction will be more in charge.

Ashley Daigneault: ChefSteps introduced its first hardware product – the Joule sous vide cooker. Why did you decide to create a physical product, a cooking device?

Chef Chris Young: We’ve always been focused on listening to our community. When ChefSteps was founded in 2012, we took the spirit from Modernist Cuisine and demonstrated that people were hungry for info on how cooking works. We initially started with YouTube videos and interacting with viewers and built a website to aggregate the content. And we continued to listen – what did the community want from us?

We found that our community was passionate about cooking. Even for people who were really good at cooking, the tools in the kitchen were pretty painful. The typically didn’t help them be creative or help them innovate. We could solve problems by giving people tools that were better, helping them be more successful and creative in the kitchen. And this has always been our mission: to help them to choose to cook better food at home instead of eating out.

Ashley Daigneault: What were the challenges in bringing a device to market?

Chef Chris Young: It’s expensive to do hardware right – but we wanted to do it right. We looked at the tools out there but we saw that sous vide cooking hasn’t changed much since 2003 other than price. Since ChefSteps creates the content, we can show people how to cook the foods they want, the way they want and connect it to a device that heats and stirs the water and makes that happen.

Good direction will get more people cooking – people feel more in control, and more importantly, by leveraging mobile apps, we can learn. Our community gives us feedback about what they like about our tools vs what they don’t so we can make changes in software and not make folks buy new devices every time we learn new things. Ultimately, the drive is about getting people to cook and at some point you have to move beyond the phone to cook the food.

Ashley Daigneault: As a chef, do you think technology can make people better cooks?

Chef Chris Young: Absolutely. There’s this viewpoint that things were better the way our grandmother did things, but that’s not really true. For one, food poisoning was rampant as there were no safety standards. Technology has definitely made that better. We have access to better ingredients than ever before, food is healthier now than ever before. Actually, it’s pretty damn amazing what’s possible.

Ashley Daigneault: What’s your go-to gadget or product in the kitchen that you can’t live without?

Chef Chris Young: The thing that has done more to make me a better cook – a digital thermometer. It’s really allowed us to have consistency and control and make sure we were giving people the best possible food. Humans are really good at certain activities – but measurement is NOT one of them. Give me a simple digital thermometer, a scale, a good knife and a decent pan – I can pretty much cook everything.

July 23, 2016

Doug Evans: The Full Interview

Michael Wolf: What is the news today? What is the product we can buy from Juicero?

Doug Evans: There’s three parts to the Juicero system. There is a very complete software platform that tracks the produce from the farm all the way through the Juicero press and provides visibility and transparency into the ingredients, into the source of the farm, into the nutrition, when it was created and when it expires. We built this software platform that connects to our financial planning system as well as into the cloud, into our website, and mobile and Android and iOS, so we have a full software system that actually comes with the Juicero press. We actually created a very elegant piece of hardware, which is literally one part iPhone and one part Tesla roadster [laughter].

It is a consumer device that has industrial strength and capability, all designed to extract the juice or the nectar from fresh, ripe, raw organic fruits and vegetables. Those fruits and vegetables actually come in the form of a pack, P-A-C-K, so we actually have in the Los Angeles region 110,000 square foot refrigerated LEED Gold-certified processing facility where we receive produce from the farm.

The vision is not to store inventory produce but to take the e-commerce orders and then reach out to our 14 farm partners, source the produce, have it transported to us on refrigerated trucks, and then inside our facility, we triple wash them, chop them, mix them, and put them into these packs. The packs have allowed design in engineering and their packaging a very unique QR code put on them, and that QR code can be read by an iPhone or an Android and the pack also gets read automatically by a scanner inside of the Juicero Press.

Michael Wolf: A lot of companies when they’re entering the space like the kitchen, for example, they’ll create one part of this ecosystem, you guys literally had to create to use literally the lingo we want – value chain ecosystem all the way from sourcing to processing to the press. Was there any other way to do? You feel like you had to do this entire I guess delivery system and press.

Doug Evans: Yeah. In the beginning, after I left Organic Avenue and I wanted to figure out what I was going to do next because I was very hungry and very thirsty, I found a real gap in the market that the quality of juice that I was accustomed to, which was coming right off of a press I could literally in my prior organic kitchen, I could gulp with a glass and that cold press juice pour right into the glass, and I was able to drink it. When I got home, I was wondering like where am I going to get my juice. I looked at the options on the Internet, on Amazon, and Bed Bath & Beyond, and Williams-Sonoma. Basically, all the juicers that were available were using either augers or gears or centrifuges, and they operate at different speeds but fundamentally they were all copies of the same design.

But what I knew from my actual 10 years of Organic Avenue was I learned about cold presses, and all the big juice companies use cold presses. Organic Avenue used cold presses and so I knew the difference between the industrial, commercial juice presses and the consumer ones that were made available via retail. I just saw a big gap. Similar to the spirit of what Apple did with taking the mainframe computer and creating the personal computer, I looked at was it possible to take a mainframe juice press and create a personal juice press, with some of the attributes that makes it easy to clean and making it small so it fits on a kitchen countertop. That was my original design intention.

Very quickly, I was able to cobble together a prototype and we took fresh produce and we chopped it, and sliced it and grated it and wrapped it in cheesecloth and put it in the early prototype and turned it on. Lo and behold, I was able to press the juice out of the produce. That’s what I actually brought to Silicon Valley was a very crude prototype, but the design and my design intention allowed me to make five juices in 5 minutes with no setup and no cleanup. The end product was this new type of juice.

Mike, did you get a chance to watch the video, Juicing is Easy, on YouTube?

Michael Wolf: Yeah. Yeah, that was great. You did a good job with that. From my understanding, it’s the first consumer or home cold press. Is that right? You guys really have essentially created, if you’re using analogy of the personal computer, you’re the first one to create like a personal juice presser for the home.

Doug Evans: Correct.

Michael Wolf: Cold press.

Doug Evans: Cold press. There are a ton of juicers and there are things that call themselves presses but if you look at the press, the destination of like two being pressed together, there is nothing like that that’s not thousands of dollars and more designed for commercial or industrial use.

Michael Wolf: Explain the reason why. My understanding there is you’re bringing a lot of force there, and I think that’s probably part of the challenge to be able to press at the level you need juice. What were the challenges from an engineering design standpoint and getting to a cost reduction standpoint that you could bring it into consumer price points?

Doug Evans: Look, I think you can get a lot of force with the sledgehammer, but you can’t make juice with it. You can get a lot of force with large industrial equipment, so I think the challenge was how can we get this level of force inside a small contained unit with the other caveat of having the electronics and the sensors. It really was a process of not this trial and error but form following function. We had to both develop the packaging and the press, and the interface between the package of produce and the press. There were several concurrent initiatives, not always going in [unintelligible 0:11:30] so we get ahead of ourselves on one end and then have to slow down and put the different items together.

But inside the press itself, there’s 10 printed circuit boards, there’s two motors, there’s several hundred parts, all custom. There are parts inside that are machine, CMC machine. They are stamped. They are forged. They are casted. There’s a lot that went into it, and then there was designing the mechanism to generate the force, which involved literally the casting design of the gearbox that actually could generate the force. Then we had to reduce the size and the weight and move towards aircraft-grade aluminum so that it could be wider and stronger within a consumer footprint.

Michael Wolf: You have this pretty nice feat of engineering, but alongside that, you have a lot of other things. When you work at the back of the plan you drew up, I think you said 39 months ago, where you have this processing plant for all the fresh food that goes into the pods, you have your delivery system, the subscription service and the press, is that all true to the original vision or at some point, did you say, “Okay, we’re going to do our own pods, etc.” I mean how true to the vision are you at this point to where you were 40 months ago?

Doug Evans: I thought in the early days that I would be able to get some help, so I thought that some of the larger plant manufacturers would be eager to partner with me on creating the physical appliance and that turned out to not to be false. Then I thought some of the fresh suppliers would be able to do the cold packing or doing the processing of the produce, and that also proved to be false. I think I had to be able to create like everything because there was a standard that I knew we needed to have and what’s available on any pods. The vision that I had is very true to the vision; the manifestation of that vision has required me to go on quite a curvy path.

Michael Wolf: [laughter] The price point is $700. Some people have said that’s high. Obviously for a new type of device, that’s always a challenge, a new type of device that people are trying to wrap their mind around. Although I think people understand the idea of a juicer, this is different. Who do you think you’re targeting with that price point and then over time, you see that coming down?

Doug Evans: Yeah, I think I’ll answer the second part first. I think the price will definitely come down as we kind of optimize and shift and move way from CMC metal parts to forged and casted parts. The cost will be able to come down as we get to scale. This is the first product. We had to really make sure that it was safe. Almost every tolerance is overbuilt to beyond safety parts, so it’s a very comprehensive safe design. As we can do statistically significant wear tests over time, we can see where we might be able to make things wider or thinner, which should also result in making things less expensive. That’s on the price part.

On the first part was the target customer. I think the target customer today is really people who drink fresh juice or people who are drinking cold-pressed juice. In our research ‑ and we’ve done quite extensive quantitative and qualitative research ‑ that people love fresh juice. Even people who don’t want to like fresh juice end up loving fresh juice and I can elaborate on that in a minute. But fresh juice is really not easily obtained. I love the video that we shot, which is really true, which is why people resonate with that. And so people who don’t want fresh juice and they don’t want to make it end up getting juice in a bottle, and the juice in a bottle are the sheer nature that is put in the bottle is no longer fresh as they make on their own.

The idea of not making juice but actually making a system or a platform so that people could juice on their own and supplying the press and the produce and in a package that doesn’t get contaminated and doesn’t make a mess. The goal was based on this research people on a home juicer were using their juice once or twice a month and people had a coffee machine were using it once or twice a day. If we can make it that easy for them to make juice at home, then we thought that they would do it. I think that’s what helped our investor community feel supportive than some of them you can imagine in a partnership there’s all types of people, there was always someone who loved juice and there was like the juicing hero in a room. Then there are always some people who are like, “I drink coffee. That’s it.”

Invariably, everybody loves the Juicero juice like everyone just loves it. When they were asked, and I really become a fly in the wall in the discussions, because I was asked, “Hey, if juicing was this easy, will you do it?”

People who otherwise wouldn’t drink juice would raise their hand and say, “Yeah, you know what I would. I know I need more servings of fruits and vegetables. I know this is good for me, and this tastes good. I’ll get it. I’ll get it for my mother, or I’ll get it for my wife,” or blah, blah, blah. All of a sudden, you’d walk out of a meeting and there was enthusiasm. That’s what really helped raise this capital and get the momentum behind the machine was that we had early, very early on proof of principle that worked and I had the credibility of being in the juice market before, so there was product, calendar, market fit like that was no dispute that there was a real market and a growing market for super premium cold-pressed juice. Here was a product that made cold-pressed juice in a novel and easy way. There was someone that I felt very fortunate the board and the lead investors were willing to get behind and support me as the leader.

Michael Wolf: Now you guys are originally to start off distributing only in California –

Doug Evans: Yeah.

Michael Wolf: I was wondering about that. Is that because you’re just trying to get all the kinks ironed out or is it because your packaging and your production is there, and if you expand to a nationwide footprint, do you need to have packaging and production facilities in other parts of I guess the country?

Doug Evans: Our primary facility is designed to be able to make millions of packs per week, and I think the United States shipping logistics systems are pretty comprehensive to be able to get to most zip codes overnight anywhere in the country. It is clearly more efficient in some cases if you’re closer to the facility so one could think about building a facility close to Memphis, Tennessee. But I think that the reason our headquarters is in San Francisco and our produce is processed in the same facility in Los Angeles.

Originally we were going to do the test in San Francisco because we had a small quantity food lab here in San Francisco and then when we got this mammoth facility outside of Los Angeles, we were going to do in Los Angeles but we were constantly sending things back and forth up to San Francisco. We just looked at saying you know what, it’s the same effort to do the entire state, but at least this way we can put and order around in parameters so that we can effectively do the testing, in your words, work out the kinks. Then have visibility into what recipes people are consuming, how often like in my last presentation, I said I have no projections because any projection I would make if we were right, it would be because we were lucky, not because I’m smart.

We just wanted to make some assumption and have a thesis that we could control so if this first 2,000 presses that we’re sending out in California, we could then actually have real data that we can then use to model. Then it would not be a good thing if someone bought a press and we didn’t have the ability to send them packs. That’s kind of the walk before we run strategy.

Michael Wolf: Well, I’m up here in Seattle. I’m sure people in other parts of the country are excited possibly to get one. Do you have an ETA for outside of California?

Doug Evans: I would say we’re looking at Q3 and Q4. For you, Mike, I have a meeting up in Seattle on the 12th, so it’s possible we could rendezvous somewhere to taste the juice.

Michael Wolf: [laughter] Taste the juice. I might have to do that. That would be awesome. When we look forward towards the future, are you going to be – Juicero, it’s in your name. I would imagine juice is going to be your core mission. Can you see yourself expanding into other related categories or do you think you’re going to stick mainly with juice?

Doug Evans: Well, I think I too need to sell a lot more than music, and I see the area of what our core competency is in managing fresh, ripe raw organic fruits and vegetables and designing hardware and software that can use it. But Juicero seems like a good name. the domains were available. We should get all the social handle and it almost sounded familiar to me when I came up with the name, so we just went with it. But I think you can expect a lot more, something that are logical and obvious and something that might seem like a stretch in the story.

Michael Wolf: One of the things, you guys are definitely one of the most high-profile stealth companies I think I’ve seen and probably maybe I’m closed too because I’ve been following the connected kitchen and you’re certainly one of the most high-profile stealth companies in that space, but why so secret? Were you worried that people are going to copy the idea? What was the reason for the secrecy?

Doug Evans: I think that I wanted to stay focused and I didn’t know how long it was going to take to do, and I didn’t see any value about talking about things before they were ready, and sort of saying I had really nothing to say like I’m not someone who’s a smart engineer or food scientist. I really don’t want to talk to anybody.

Michael Wolf: [laughter] Well, this has been great. Hey, Doug, I appreciate it on your big day. Congratulations! People can find you at Juicero.com if they want to check it out, right?

Doug Evans: Absolutely, absolutely. Thanks so much, Mike. You’re terrific and it’s an honor to meet you over the phone.

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