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Daily news and analysis about the food tech revolution

Weekly Spoon

Weekly Newsletter: Food Tech 25, 3D Printed Meat & Food Tech for Cafeteria

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We just released The Spoon’s 2020 Food Tech 25 list yesterday, and we hope you have as much fun we reading it as we had creating it.

Each year, the Food Tech 25 is a chance for The Spoon’s staff to talk about what’s happening in the space that is truly innovative. We pitched ideas, defended nominations, and maybe even shed a tear or two. (What? I love food robots).

This year’s list is unique in the Food Tech 25 history because it comes during the middle of a global pandemic. We didn’t want to make this list all COVID all the time, but it’s a reflection of companies that were vital enough weather this worldwide storm, adapt accordingly to the new world being shaped by it, and preparing us for an even better post-pandemic future.

The 2020 Food Tech 25 features a ton of great companies big and small, including:

  • Culture Biosciences – a company trying to create the AWS of bioreactors
  • Tovala – the smart oven and meal service that’s seen demand surge
  • Perfect Day – whose flora-based ice cream tastes like the “real” thing
  • Zippin – a startup changing the cashierless checkout game
  • Picnic – a robotic system that cranks out 200 pizzas an hour

You should definitely check out the full list because every company on there deserves its spot.

Congratulations to all the companies that made the 2020 Food Tech 25, we look forward writing about how you continue to change the world (and listing those accomplishments).

3D-printed plant based steaks get an industrial boost

A company we’re definitely keeping our eye on for next year’s Food Tech 25 list is Redefine Meat, which uses 3D printing to create plant-based steaks. The company announced new high-production industrial-level 3D printing capabilities this morning. As Spoon Founder Mike Wolf wrote:

This new capability, which the company says allows them to now print up to 50 steaks an hour, will help company roll out its 3D printed steaks to select restaurants in Europe this fall for market tests as it prepares for a broader rollout of its industrial 3D meat printers to meat distributors in 2021.

Redefine’s 3D printers cost $100,000 a pop, which really puts the “select” in “select restaurants.” But the company’s technology is still very early and is coming at a time when sales of plant-based meat are booming. So hopefully the company can ride that wave of popularity to scale up faster and bring its prices down.

What’s fun, from an industry watcher perspective, is seeing the number of different alternate protein solutions in the works. From the massive scale of existing plant-based players like Impossible and Beyond Meat, to the burgeoning cell-cultured world of Integriculture and Memphis Meat to the 3D printing of Redefine Meat, the alternative protein space is really starting to cook.

Can food tech save the school cafeteria?

Despite all the great companies we have on our Food Tech 25 list, sadly none of them have cracked the problems that will come with re-opening school cafeterias during this pandemic.

The question of what in-person schooling will look like is one families across the country will face in just a matter of months. While it may be “easy” to mask up and socially distance kids inside a classroom, all bets are off when it’s time for school lunch.

How do you create a safe cafeteria experience for hundreds of kids who are yelling, running around and just being kids? It’s a conundrum I brought up over the weekend because it doesn’t seem like something food tech can fix . But I’d love to hear your thoughts if you’ve seen, heard or thought of a solution.

My Other Phone Is a Restaurant

The surprise hit story on The Spoon this week has been our recent post on Mexico City-based remotekitchen, a startup that’s building a mobile-first restaurant-tech platform that, theoretically at least, only needs a smart phone to operate. 

I highlight this story not because I think every restaurant needs to pare down their tech stack to a smartphone, but because now more than ever, restaurant tech companies need to ensure their products are offering real value to restaurants. In other words, they need to solve problems restaurants are having right now while also helping to prepare for the ones waiting for us in the future.

Remotekitchen’s platform solves some obvious problems for its core audience. Its founders explained to me that 96 percent of independent restaurants in Latin America are not online, that restaurant tech solutions are underdeveloped in the region, and that a vast majority of restaurant owners have to take orders via their own smartphones. The mobile-first approach also better equips operators to run virtual restaurants, which may be necessary depending on how high the coronavirus wave spikes.

The U.S. is not like Latin America when it comes to restaurant tech. We have choice and then some. Prior the pandemic, restaurant tech solutions included not just point of sale systems and self-serve kiosks, but also reservations management, wearable computing, virtual reality on boarding . . . the list goes on and on and on.

I don’t think restaurant tech companies should necessarily stop work on any of the above solutions, so long as they’re somehow helping restaurants solve the industry’s most urgent problems. Such as:

Improving restaurant pickup orders. For restaurants new to the off-premises world, juggling takeout and/or curbside pickup orders has proven challenging — to put it politely. Restaurants need more streamlined ways to both receive and deliver pickup orders to customers. (Geofencing, perhaps?)

Making restaurants more socially distant. I don’t refer to space between tables here. That is not a problem tech needs to solve. Menus, on the other hand, are. The number of simple digital menu solutions out there right now is encouraging, and many of them rely on simple signage or QR codes. And unlike chalkboards or disposable paper menus, digital menus could eventually become interactive tools for guests to learn more about the food they’re eating.

Enabling better communications with customers. This one is huge. Back when the pandemic first hit. I remember one restaurant telling me their customers didn’t even know they were open for takeout. Part of this is due to the rise of third-party delivery, which owns a lot of customer relationships. Delivery integrators are one way around this, as they allow restaurants to offer off-premises while still keeping their customer data.

These are just a few of the hot-button issues in the restaurant biz right now. I’m sure you have others, so drop us a line (tips@thespoon.tech) to let us know where you think restaurant tech will be the most valuable right now.

Restaurant Closures Underscore the Need for Off-Premises

The week, Yelp released new data about COVID-19’s continued impact on businesses, the restaurant industry included. The takeaway? A bunch of restaurants that have temporarily closed may never reopen.

Quite a lot of them, actually. 

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. 

“Restaurants run on thin margins and can sometimes take months or even years to break even, resulting in this higher rate of permanent closures,” Yelp explained in its update. 

This is aggravated by the rising number of COVID-19 cases across many states, which is causing governments to either delay reopening or order closures again. Some restaurants that had already reopened have to close once more because of employees becoming infected. 

Right now it’s incredibly hard to predict the total number of restaurants that will close permanently. Yelp’s numbers are actually smaller than a report by Independent Restaurant Coalition that said 85 percent of indie restaurants could close by the end of the year. Still, tens of thousands of restaurants is a lot of restaurants.

The lesson? First, that we’re going to be riding this will they-won’t they wave in terms of restaurant closures for a long time. Second, those that can, must continue finding ways to serve their customers with off-premises orders, even if their dining rooms have partially reopened. 

I’m All-In on Smart Vending Machines for Restaurants

On the note of restaurant tech that’s useful, The Spoon’s Editor recently did a report on the promise of automated vending machines in the foodservice world. I give it a shout out here because these next-generation machines, which serve up actual meals created by real chefs, could be the answer to getting good food in a socially distanced manner in many settings.

Consider the old mall food court, where you could mill between different restaurants and build your own smorgasbord of mediocre mall food. Digitizing as much of these very public spaces as possible will be necessary for sanitization and social distancing in the future. Since next-gen automated vending machines are basically their own little restaurant in a box, it’s possible we’ll one day head to food courts not manned by people but equipped with multiple machines from different brands offering increased choice without so much human interaction.

Given the way this pandemic is heading, smart vending machines could be a really smart idea.

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What’s Getting Funded in Food Tech Right Now?

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This global pandemic may have slowed down our day-to-day activities, but VCs are still cranking out deals in the food tech world.

We at The Spoon have covered 19 funding announcements between May 15 and June 15. FWIW, a quick check through the archives showed that we covered 21 funding announcements throughout ALL of May and June in 2019. And last year, we weren’t all confined to our homes and forced to do all our business via Zoom.

But back to this year. There was a total of $699.58 million raised over this past month, with big raisers being Instacart ($225M) and Apeel ($250M). There was a pretty even split between consumer-facing and B2B companies, with 10 consumer-facing companies getting funded and nine B2B companies.

Breaking it down by (broad) category, funding went to:

Three lab/cultured cell companies:

Three plant-based food companies:

Three food waste companies:

Two grocery companies:

Three home cooking companies:

Three restaurant-related companies:

One AgTech company: Agro Club – $1.5M

One garden company: Rise Gardens $2.6M

Just looking at this list, it’s easy to see that the alternative/cultured/plant-based food space is still hot. That’s not too surprising, given COVID-driven disruptions to the traditional meat processors and skyrocketing sales of plant-based meats.

The home cooking investments make sense as well. With people stuck at home, they are in the market for tools that make cooking their own meals easier. Tovala told us at the time of its funding announcement that it has seen its business accelerate since COVID hit.

Food waste as a category is interesting because three very different approaches to the problem got funding. CleanCrop ionizes gasses around food post-harvest to reduce spoilage. Apeel uses a plant-based coating to extend produce shelf life. And Imperfect sells boxes of “ugly” produce.

I’m curious to see what happens as summer approaches. Typically, summer is a time of vacations and travel, but given fears around travel that remain, [–MORE–] food tech startups could be boarding the money train.

Busboys and Poets. Photo by Andrea K. Castillo

Shifting food equity

Publisher’s Note: Here at The Spoon, we wanted to find ways to better highlight voices with a lived understanding of the deep-rooted, long-standing systemic racism in the United States, black voices, with a focus on how it has impacted the food system. The following is an excerpt from a guest post by Journey Foods CEO, Riana Lynn. We’re hoping to continue the conversation, so if you have a perspective on this important issue, we’d like to hear from you.

Our eating is not equal

And it hasn’t been since the day we laid eyes on the crops of our native landholders. In America, too many of us have had to hold our heads down, fixing our hunger after hours of kitchen warfare, just to eat off a measly plate in the corner of the kitchen. It has become a lonely place: an emotional and physical food desert.

Today, many of us have heard of the defining term “food desert,” otherwise known as an urban or rural geographic area with low levels of access to healthy and affordable foods. In a 2019 Household Food Insecurity in the United States USDA report, more than 37 million Americans face deep hunger while Black neighborhoods have the lowest access to supermarkets and pervasive access to underserving corner stores and bodegas. The word “desert” for many conjures images of emptiness or destitution instead of the realities of life and communities.

A “food desert” may indicate a natural phenomenon for some, rather than shedding light on the systemic racism that underlies food inequality in America. In fact, if you ask people in low-income Black and Brown communities whether they have food most respond with a feeble, “yes.” You see, having food is one thing. What we must remember is that most of our food has been developed the same way as our schools, roads, and train systems: backwards. So, even when we are braced with an overwhelming lot of food options, they almost always lack the nutrient-density need to curb away from negative outcomes. Our bodies, minds, and spirits are left thirsty. We’ve failed 100 million eaters.

Continue reading.

Join in our First Virtual Food Tech Pitch Sesh

This Thursday at 10 a.m. PT, The Spoon will be hosting our first ever Virtual Food Tech Pitch Sesh.

Three startups. Two judges. Lots of constructive feedback and even more fun. Join The Spoon as we invite three food tech startups to pitch their product and they get constructive feedback from our judges.

The judges for the first Food Tech Pitch Sesh will be Brita Rosenheim of Better Food Ventures and Scott Heimendinger, the founder of Sansaire and long-time food tech entrepreneur. 

The startups you will see pitch are:

  • Immuric – a personalized nutrition app
  • Minnow –  a contact-free food pickup solution
  • Kitch –  commercial kitchen marketplace connecting underutilized commercial kitchens

Join us and cheer them on!

I’m Not Ready to Eat at Restaurants Yet, Are You?

And now, a tale of two takeouts.

For the first time in months, I left the house to actually set foot in a restaurant over the weekend. Both trips were just to pickup food, not eat in, but each experience was vastly different.

The pizza joint I went to had casual safety precautions at best. People were asked to socially distance. Some wore masks in line while others did not. When I signed the check, the cashier wiped the pen down with some rag before handing it to me, which actually made the idea of touching it worse in my mind.

The donut shop I stopped by was a different story. They had pink donut decals dotting the floor six feet apart, indicating where to stand. They offered masks (brought my own, thanks!) and when I signed the check, there were two containers of pens by the register, one for sterilized pens, one for used pens.

I’ll admit that I’m a bit of a germaphobe and on the more extreme end of caution. So the visit to the donuts shop was a little easier to manage. Ultimately, though, neither felt like it was worth the trip, and I can’t imagine that I could sit through an entire meal inside a restaurant dining room with other people right now.

The speculation around what restaurants will look like when they re-open is giving way to the reality of what they are actually doing. We can see for ourselves what measures are being taken to prevent the spread of the virus. What I’m learning is that for me, technology has made getting food to my door so convenient that I don’t need to go out to actual places. I’d much rather just order delivery (and tip generously, I promise!).

I don’t know if my coronavirus fears represent a larger use case or if I’m just off on my own quarantine island. But the reason I’m sharing all this with you is to see what you are comfortable with. For real! I can read restaurant sales stats from NPD and talk to friends and co-workers, but I’m genuinely curious what all of you in the food tech world think about going out to restaurants right now. Are you ready to go to one? What would make you feel safe? If you’re not ready now, when do you think you will be?

Email me at tips@thespoon.tech, and tell me your tale.

Image via Uber.

What will happen with office catering?
While restaurants may be re-opening, many companies are still figuring out what going back to work in an office means. Will there be fewer people at a time, staggered hours, plexiglass shields? We don’t know.

But if the very existence of working in an office is in question, it stands to reason that office catering and the free meal perks that were a staple of Silicon Valley could be a thing of the past as well. At least as we knew them pre-pandemic. Big buffet style meals are gone from restaurants and grocery stores, so they probably won’t be in the break room. Not to mention the fact that we’re in a recession, so companies won’t have the same budgets available to feed workers.

All of this makes Uber Eats’ launch of its Vouchers program something to watch. Announced today, the new program gives Uber Eats’ corporate customers more control over ordering meals. Remote users can use them for meal deliveries at home, or they can be used to feed people at large virtual events (maybe we could try that at our virtual SKS?), or a sales team could use them to buy a meal for virtual lunch.

The idea of buying remote lunches for the participants of your virtual sales call is a very particular type of solution to a very particular moment in our pandemic times. I’m curious to see what other adaptations will be made to office eating as our definition of work goes through this transformation.

This is the web version of our newsletter. Sign up today to get updates on the rapidly changing nature of the food tech industry.

Cashierless Checkout on Aisle 10. Only Aisle 10

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One of the big questions surrounding the rollout of cashierless checkout as it was emerging last year was how well it could scale. Outfitting a small convenience store with cameras and sensors a la Amazon Go is one thing. Expanding that to tens of thousands of square feet in a full-on supermarket is quite another.

It’s not just a question of the technology scaling affordably, but also how easily large supermarket chains could adopt it. Big grocery retailers have thousands of locations and are like battleships–they can’t turn on a dime. They need solutions that work at scale right away.

But Zippin’s new store-within-a-store at a Moscow grocer suggests that cashierless checkout’s future might not be an all-or-nothing proposition for big retailers. At its new Azbuka Vkusa location, Zippin turned just one aisle of that store into a cashierless checkout lane.

The aisle is blocked at one end, with a special QR code-reading turnstile installed at the other. The aisle is stocked with “80 percent” items — that is, the ones most frequently purchased — so it’s a mish-mash of products rather than being the “bread section.”

Zippin’s partial solution is interesting for a number of reasons. First, it’s a proof of concept for how Big Food retailers can dip their toe in the cahierless pool without jumping (and investing) all the way in.

Second, it provides a contacless way for people to grocery shop quickly. This aspect could actually prove to be more appealing to retailers wanting to protect their in-store workers than the convenience cahierless gives shoppers.

And finally, it may help with the equity issues around cashierless checkout. Cashierless checkout only works if you have access to a phone and a credit card. But there are a lot of under- and un-banked populations in the country in the U.S. who don’t and would thereby be shut out of cashierless experience. Having a cashierless only aisle doesn’t solve all the equity issues with that system, but at least it doesn’t prevent a person from going into a store.

The reason I bring all this up is that there are a lot of startups looking to retrofit existing grocers with cashierless checkout technology. Trigo, Grabango, Standard Cognition just a few, not to mention that Amazon is looking to license its cashierless checkout to other retailers as well.

With its Azbuka Vkusa store-within-a-store, Zippin becomes the first such startup to publicly show off its partial cashierless product. Other retailers looking to get in on that action may see the real world result and start knocking on Zippin’s door.

Image via Unsplash.

Stacks o’ pandemic stats

Just as states start to re-open, we are getting some data on how our behavior around eating has changed/is changing.

My colleague, Jenn Marston, wrote a story yesterday about a study from the Washington State University’s Carson College of Business found that 66 percent of respondents would not be willing to eat in a restaurant’s dining room immediately. Forty-seven percent said that they planned to wait three months before going out to eat.

And what will these wary patrons be looking for in their eateries? As Jenn wrote:

Consumers surveyed for the report said that sanitation efforts like masks for servers, hand sanitizer stations, and other visible efforts, like seeing staff clean tables and chairs, will be the most important safety precautions.

The results of this survey aren’t too surprising, and actually match up quite well with a recent survey that found 60 percent of respondents were “fearful” of going back into the grocery store.

All of this is to say that as certain segments of the population rush to re-open, a nervous public may stymie any potential v-shaped recovery.

Another survey out this week, this one from Gallup, shed light on how we were getting our food while under lockdown. Forty-four percent of survey respondents said that they got takeout from a restaurant in May, up from 26 percent in March. Additionally, more people are doing curbside pickup from stores. Gallup found that 36 percent of respondents used curbside pickup in May, up from 19 percent in March.

The question now is, What’s next? Have we been under lockdown long enough for these behaviors to become a habit? Or will being cooped up for so long help us realize what we were missing, and we go back to what we did in the pre-COVID world? Or will another wave of transmissions have us repeating these same patterns? Stay tuned for more stats on that.

Smart Kitchen Summit goes virtual (get your ticket today!)

If people are nervous about going into a restaurant or their local grocery store, imagine how they’d feel about being in a packed lecture hall up close and personal with 800 other people all day.

That’s one reason why we are making our Smart Kitchen Summit virtual this year! Not only is is socially distant, but as we’ve learned from our ongoing virtual fireside chat series, going online can open SKS and the food tech industry up to larger, all new audiences.

Virtual SKS will be a lot like IRL SKS. We’ll have world class speakers, a startup showcase, and sponsorship opportunities. The only thing missing will be shaking hands in the hallway, but who shakes hands anymore?

Attending is easy-peasy as well. All you need to do is buy an annual plan for our new Spoon+ premium service. There are plans for every budget and even a 40% off introductory special if you buy your ticket today (Wed., May 27). Sign up and secure your SKS ticket today!

Hold the Phone. Soon it Will Be Your Restaurant’s Menu

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A couple of years ago I came across a restaurant in Dallas, Texas that featured a menu written entirely in emojis. It was unexpected and creative, yet clear enough that a server didn’t have to come over and re-explain everything on the page.

I’m not (necessarily) advocating we battle the current restaurant industry fallout with emoji menus, but maybe we could use some of that outside-the-box thinking when it comes to revising menu formats to fit the new reality we live in. 

Since reusable menus are basically germ repositories, it’s no surprise they’re out now that dining rooms are reopening. The CDC’s recently released guidelines for reopening suggest restaurants “avoid using or sharing items such as menus” and to “instead use disposable or digital menus. . .” The National Restaurant Association’s guidelines tell restaurants to “make technology your friend” and suggest mobile ordering, and every other restaurant tech company that contacts me these days is offering up some form of digital menu for restaurants to integrate into their operations. 

A lot of restaurants will definitely start out by offering simple disposable menus. Paper is cheaper than software most of the time, and typing up and printing out a menu is faster than onboarding your business to a new tech solution.

Over time, though, that could change. As more emphasis gets placed on digital ordering for everyone, we’ll access more restaurant menus through our own phones and mobile devices. That opens up a whole world of possibilities in terms of what restaurants could one day offer on their menus beyond just the food items themselves.

Just a few examples: Menus could provide in-depth information the ingredients in a dish, like where that cilantro came from and how many months the apple traveled before it hit your plate. Menus might also include ratings from other customers, and Amazon-esque “you might also like” recommendations could show up on the screen. Maybe you could dictate the portion size you want, thereby reducing food waste.

With AI making its way into restaurant tech more and and more, restaurants could also build dynamic pricing into menus, based on time of day, foot traffic, weather, and offer coupons and promotional offers in real time. And sure, if someone really wanted to, an emoji menu would probably fly right now in more than a few places.

Most of these things exist already, though they’re not widespread and some are still in conceptual stages. The massive overhaul of the restaurant menu is a chance to start bringing those disparate pieces together to revamp the way we order our food.

Kitchen United Is Open for Business in Austin

One effect of this whole pandemic is that we’ve seen an uptick in to-go orders, and that trend won’t subside anytime soon. That makes now a good time for restaurants — some of them, at least — to consider adding a ghost kitchen to their operations. 

Those in Austin, TX can add Kitchen United to their list of choices when it comes to choosing a facility. The company, which provides ghost kitchen infrastructure (space, equipment, etc.) to restaurants announced this week its new location near the University of Texas is open for business. 

A number of restaurant chains have either already moved into the space or plan to do so in the coming weeks. Kitchen United has also allocated one of the kitchens in the new space to Keep Austin Fed, a nonprofit that gathers surplus food from commercial kitchens and distributes it to charities. As part of the deal, Keep Austin Fed will be able to “rescue” food from restaurants with kitchen operations inside the new KU facility. 

A press released emailed to The Spoon notes that “additional kitchen space is currently available” for restaurants that want to expand their off-premises operations. On that note, a word of advice for restaurants: make sure your restaurant is actually in need of a ghost kitchen before signing up with one. Kitchen United’s own CEO, Jim Collins, told me recently that restaurants need a certain amount of customer demand in order for the economics of a ghost kitchen to make sense. It’s not a small demand, either. In times like these, where the future of all restaurants is uncertain and what little money there is needs to be spent carefully, it pays to exercise some caution, even when it comes to an enticing new trend like ghost kitchens. 

Los Angeles Moves to Cap Third-Party Delivery Commission Fees

Behold, more fee caps for third-party delivery companies. This week, the Los Angeles City Council voted 14–0 to ask attorneys to draft a law that caps the commission fees delivery services charge restaurants at 15 percent. “Why should restaurants, and their customers, be put in a position to subsidize delivery app companies? We need to level the playing field,” Councilman Mitch O’Farrell told the Los Angeles Times.

This week’s proposal would also require that 100 percent of the tips customers leave on delivery orders through these apps go directly to the driver, which is pretty standard nowadays but caused some ruckus in the not-so-distant past. The fee caps would end 90 days after Los Angeles lifts its dining room closures. 

Needless to say, the move — which several other cities have already made — is not popular with delivery companies. Postmates, which is LA’s most popular third-party food delivery service, said governments setting a price on fees threatens jobs and creates “a false choice between local restaurants and the delivery network companies that support them.” The service wants instead to have a fee charged in delivery orders that would assist restaurants. That in turn would translate to yet-another fee for the customer, and be yet-another way in which restaurant food delivery services will suggest/try anything to avoid having to shoulder some of the burden the pandemic has brought on the restaurant industry.

As restaurants slowly reopen and the industry starts to adjust to its new normal, now we’ll begin to see if fee caps actually make a difference for struggling restaurants, and if they are here to stay for the long run.

Be Like Walmart and Swing for the Geofences

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Prior to the pandemic, I never grocery shopped at Walmart. It was too far away and I wanted to support my local supermarket. Throughout this pandemic, however, I’ve been at Walmart every week for my curbside grocery pickups. One reasons I’m such a frequent Walmarter now is that they make the whole process of getting groceries via curbside easy. I place my order, schedule my pickup time and when my groceries are ready, they send me a notification on my phone.

Part of that notification asks me to check-in with the Walmart app to let the store know I’m on my way. As I pull into their parking lot, the app automatically recognizes that I’ve arrived, thanks to the GPS on my phone and Walmart’s geofencing technology. Once I specify my parking stall, a Walmart staffer is out with my order and bada-boom, bada-bing, in minutes my trunk is loaded, no human contact has occurred and I’m on my way back home to shelter in place for another week.

Contrast Walmart with the curbside pickup experience at my local Safeway, which is a lot closer than the Walmart but does not have geofencing in its app. When I arrive at the store, I have to call a special number to let them know I’ve arrived, they ask me what stall I’m in and then send someone with my order out. Obviously my calling a number isn’t a huge deal, but it’s one extra step, and one more thing for a human staffer at Safeway to deal with all day while dealing with all the other changes this pandemic has brought with it.

Contactless is going to be the word of 2020, especially as it relates to food delivery and curbside pickup, and geofencing is going to play an increasingly important part of that. Yesterday, Panera announced geofence-enabled curbside pickup for orders, and IBM has been touting Safe Queue, a virtual line app powered in part by geofencing that was created for Big Blue’s Call for Code Global Challenge contest.

As a technology, geofencing has actually been around for long time. But it will take on more importance as restaurants and grocers look to efficiently maximize their revenues while reducing human-to-human contact. Restaurants that must operate at reduced dine-in capacity need a robust off-premises plan, including curbside pickup, and people are still scared of going into the grocery store itself, requiring pickup options as well.

Geofencing means orders can be fulfilled more quickly because the restaurant or supermarket knows when you’ve arrived. Walmart may have huge parking lots and plenty of space for cars pickup up orders, but a lot of restaurants and independent grocers don’t. They’ll need to make the most of their physical takeout/pickup space. The faster a curbside order is handed off, the faster cars turn over in the parking lot and the more orders can be fulfilled.

There is obviously a privacy tradeoff with geofencing. Some people may not want to hand over their location data to Walmart, Panera or whomever, and that’s okay. Different strokes and all. Privacy is a constant question we come up against in this connected world, and we should definitely hold businesses accountable to being good stewards of our data.

There are lots of changes consumer facing food businesses will need to make (and re-make) in order to survive this pandemic. But if curbside pickups are part of your plan, you should fire up the geofencing now.

Woot! Founder Launches Pasta by Mail

It kinda makes sense that Matt Rutledge, the founder of Woot!, an e-commerce site known for its sense of humor, would choose noodles for a food-related project. I mean, noodles are funny, especially the way Rutledge is selling them.

Rutledge launched PastaDrop, a “pasta as a service” online pop-up that lets you buy random amounts of pasta and have it sent to friends. PastaDrop determines the quantity of noodles being shipped and hilarity ensues (again, because noodles = funny).

Spoon founder Mike Wolf reached out to Rutledge for an email interview to find out more about PastaDrop. You should read the whole exchange (it’s very entertaining), but here’s an amuse-bouche to get you started:

Wolf: Why pasta?

This is our first Pasta experience! What a product! There is a subset of variety with personal opinion. There are amazing recipes to share. It’s a comfort food. It has a long shelf life and can be transported without much risk of damage. It is quite dense and therefore efficient to ship; hundreds of servings can fit in a box. Best of all it can be funny in mass quantities! Oh, and there are pasta puns — we love puns!

Sign Up for Spoon Plus, Our New Membership Insights & Virtual Events Community

Last week we announced the launch of Spoon Plus, our new membership community that gives you exclusive deep dives on food tech trends, original market research, and virtual events with the smartest people in the industry.

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This Week At The Spoon

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Welcome to Burger King. Did You Have a Reservation?

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Things I never thought I’d live to see: a global pandemic shutting down the economy, the McDonald’s snuggie, and fast food restaurants requiring reservations to dine in. But with the restaurant biz on the brink of catastrophic meltdown and businesses slowly reopening under strict social distancing practices, we can expect lots of new versions of the on-premises experience over the next few months — and probably a total redefining of what it means to be a restaurant. 

News landed this week that Burger King is testing an app for dine-in reservations at three stores in Milan, Italy that are expected to fully reopen on June 1. Reuters reports that the app lets customers order food and book a table before ever setting foot in the restaurant, which will operate at less than half its pre-pandemic capacity. During peak hours — 12–2 p.m. and 7–9 p.m. — roughly one-third of those tables will be reserved for customers using the app.

The company says it expects the new booking system to keep its revenue stable in the face of reduced in-house seating. Previously, BK in Italy got about 70 percent of its revenues from dine-in customers. Social distancing won’t allow for that now, and BK said it hopes to make up some of those lost sales with drive-thru.

Reservations are one way to keep crowds at bay in QSRs. Another is to build social distancing features into the actual store layout and operations, as McDonald’s has done in The Netherlands. The mega-chain is trialing a few initiatives at one store in the city of Arnhem, including table service, where burgers are delivered on trolleys, designated waiting spots for the line, and hand sanitizing stations at the store’s entrance. There may also be a host behind a plexiglass-shielded station, directing people where to stand in line.

There’s no word yet on whether this McDonald’s prototype will make its way to the U.S., though I wouldn’t be surprised if some social distancing elements wind up in the chain’s ongoing Experience of the Future store remodels. Burger King, meanwhile, has said if the trial of its app is successful in Italy, it could be used in other countries. 

And while QSRs are busy adopting features we’re most used to seeing at casual dine-in joints, the latter continues to adjust its format to be more to-go friendly. This was already happening B.P. (before pandemic). Now, sit-down restaurants are accelerating the addition of things like drive-thru lanes and self-service kiosks to keep business moving and socially distant at the same time.

All this suggests some seriously blurring lines between the normally siloed types of restaurant experiences. Going to a McDonald’s might suddenly feel like a more formal affair, while family dinner night at The Melting Pot might feel strangely casual without the usual person-to-person formalities. Tech tools that automate the order and pay process, and redistribute the tasks of servers, food runners, and cashiers, will only further change the now-fluid definition of the restaurant. 

We’re only at the start of things when it comes to these new dining out formats. Expect many more iterations of the restaurant to surface in the coming weeks. 

Grubhub Responds to Commission Fee Caps.

Meanwhile, I’d be remiss if I didn’t mention the ongoing smackdown between third-party delivery services and governments mandating caps on the commission fees these tech companies charge restaurants. That was a hot topic this week as more cities joined the list of those either considering caps or already implementing them. 

Grubhub responded this week via its Q1 2020 earnings call. CEO Matt Maloney said these fee caps force the company to increase fees for consumers, lessen marketing spend, and are ultimately resulting in fewer orders for independent restaurants. “Our preliminary data shows that on average, our independent restaurants are seeing over 10% fewer orders since the fee cap and many of these orders have shifted to a large brand or QSR restaurants that were not impacted by the emergency ordinance,” he said.

Note that he said “orders” not “revenues.” There’s no question that being on a platform like Grubhub makes a restaurant more visible to more potential customers. That in turn would hopefully fuel more orders for, say, your local pizzeria instead of Papa John’s.

But with Grubhub et al. taking an up to 30 percent commission of each restaurant transaction, more orders does not translate into significantly more revenues for restaurants. See this gem of a receipt, courtesy of one independent business, as proof of how little restaurants make on third-party platforms. 

On the call, Maloney said one-size-fits-all model “will not work.” And yet one independent restaurant owner who testified at a public hearing last week about NYC fee caps suggested there was virtually no negotiability when it comes to commission fees, suggesting Grubhub runs its own one-size-fits-all model when it comes to food delivery.

The debate around commission fees has been building momentum for some time. The pandemic has effectively stripped any remaining gloss off the facade of third-party food delivery and put its unsavory insides on full display. That the sector will need to make a pivot of its own if it wants to stay relevant seems more and more a question of “when,” not “if.” 

Amazon Returns to Restaurant Delivery. Sort of

But let’s end the week on a less-infuriating note, like Amazon running a makeshift third-party delivery service for restaurants in its corporate buildings. Drivers that used to transport the Seattle tech giant’s corporate employees are now running food from restaurant to customer, according to Eater Seattle.

Deliveries are contactless, meaning the restaurant packages up the order and sets it in the delivery driver’s trunk. Said driver then leaves the food on the customer’s doorstep. 

Once upon a time, Amazon ran a restaurant delivery service, which it shuttered in June of 2019. At the time, Amazon cited competition from the likes of Grubhub, Uber Eats, and other third-party delivery services. The new endeavor doesn’t appear to be a play by the company to get back into that space. Rather, it seems to be a temporary lifeline for local restaurants, not to mention a way to keep drivers who once ran corporate employees around working now that those employees are under stay-at-home orders.

On that note, have a good weekend, and don’t forget to tip your drivers.

Jenn

Curbside Bots and Contactless Everything: What the Post-Pandemic Restaurant Will Look Like

Even an introverted work-from-home veteran like me is starting to get kind of daffy during this here quarantine. But I will say that being stuck at home has given me a lot of time to think (and write) about the state of the restaurant industry, and I catch myself imagining what eating out will be like once we’re past this pandemic. So when Starbucks CEO Kevin Johnson posted a letter this week to employees about the chain’s future, it caught my attention.

In his letter, Johnson more or less said the chain is planning to reopen some of its locations and outlined a plan for doing so. To be clear: Johnson uses the words “open” and “reopen” several times in the text, but at no point promised that your local Starbucks will reopen overnight with the usual setup and operations that existed before the pandemic. 

Which is why I’m singling out Starbucks in the first place. As an international chain that has already dealt with this recovery process overseas, and as a leader in digital business and operations, Starbucks’ plans for reopening stores give us a good hint of what we can expect restaurants to look like once the process of opening the economy begins.

Pulling from Johnson’s letter as well as numerous statements and activities from other restaurants, tech companies, and governments, we put together some predictions for what the post-pandemic restaurant experience might entail.

Note that most of these predictions are around operations and the customer experience. There are a host of other issues, from labor to food waste, I’ll be unpacking those over the next few weeks, so stay tuned.

More space, fewer tables. This is less prediction and more fact, with public figures like California Governor Gavin Newsom saying restaurants will have more space between tables and fewer seats, to ensure social distancing when eating out. Separately, the WSJ noted that restaurant chains may operate at half capacity going forward, and include things like plexiglass shields between booths. That could also spell the end of buffet-style dining and family-style seating. Golden Corral, that bastion of all buffet restaurants, has closed all units for the time being. Even before state-mandated shutdowns, other businesses were nixing community seating. And grocery stores are closing down hot bars.

Lots more mobile payments. Some restaurants are already pushing customers to use their mobile apps to order and pay for food, eliminating the need to touch a kiosk or swipe a credit card. Granted, you have to have a well-designed, easy-to-use app in order to do this, which means we’ll see a surge in smaller restaurant chains developing and/or improving their own mobile experiences for customers, whether in-house or through a third-party service. I expect we’ll also see an uptick in mobile-only locations (though it’ll vary based on state laws around cashless businesses).

Curbside delivery for all. Curbside pickup was once the territory of Sonic and the odd McDonald’s location. With dining rooms shuttered these last few weeks, restaurants have had to find other ways of bringing food out. And since not all of them have been equipped with drive-thru, curbside pickup has become the default option for many. This is one of the methods Starbucks has put into practice over the last few weeks, in some cases even taking it a step further to offer “entryway pickup” for locations without parking lots.

Contactless everything. “Contactless delivery” barely existed as a phrase before China implemented it during the peak of its fight against the novel coronavirus. Now, everyone from Instacart to Pizza Hut offers it, and I doubt we’ll revert back to the old way of handing goods off between courier and customer. For contactless to live up to its name, though, brands need to think about the technical logistics behind the operation. Restaurants’ online order systems need to have the option built right into the checkout process. They should consider providing additional features, such as push notifications to alert customers when and where their order is ready. Contactless will stick around permanently for delivery and curbside orders and, when companies figure out how, probably for in-store purchases, too.

More drive-thru lanes. Austin, TX-based chain Torchy’s Tacos explained to me recently that once the chain was forced to shut down dining rooms, it quickly opened drive-thru windows in locations that had always had the feature but had never utilized it. Many restaurants set up shop in locations that were once a Wendy’s or other fast-food chain. If they haven’t already, they could utilize that space to start offering drive-thru on the regular to customers.   

Gloves and face masks for workers. Restaurants I’ve spoken with over the last couple weeks are quick to emphasize the steps they are taking to protect both customers and workers when it comes to health. Gloves and face masks nearly always come up in that conversation. They’re also part of Gov. Newsom’s plan for restaurants, and will definitely make their way into other states’ frameworks for reopening business.

Robot staff.  Having said that, though, some might just opt for robots when it comes to who’s going to handle your food. My colleague Chris Albrecht recently pointed out that dining customers might prefer “the cold sterility of a robot” to a server wearing a face mask and gloves. Robots, of course, bring up the whole loss of human jobs angle. However, as Chris notes, with fears around the virus and human-to-human contact unlikely to subside for some time, for those restaurants that can afford it, robots might be an appetizing option, at least where city laws permit. Somehow I think they would come in especially handy for running curbside orders to cars.

Okay, wait a minute. Does all this mean my future restaurant experience will involve ordering food ahead of time via an app, then waiting at a plexiglass-encased table for a wheeled bot to roll up with my burger? That sounds lonelier than a month in quarantine.

I doubt it comes to that scenario, though. The COVID-19 situation changes daily, which mean so do expectations about what restaurants will look like when the economy reopens. Maybe all of these predictions will come true. Possibly none of them will. The most likely scenario is that a few of them, like curbside pickup and mobile payments, will become industry standards, and restaurants will use a mixture of the others based on time, money, and customer volume. As states begin discussions around reopening the economy and more chains like Starbucks start outlining their plans, we’ll get a clearer picture of what to expect in the the post-pandemic restaurant experience.

Thanks to Tech, Restaurant Employees Are Accessing Earnings Faster

One area that’s part of any good discussion about the future of the restaurant concerns employees — that is, the servers, baristas, drivers, managers, and others who make up the backbone of the industry.

How they get paid is something that’s fast changing as the industry grapples with dining room closures, mass layoffs, furloughs, and general economic tension. This week, we wrote about Domino’s teaming up with challenger bank Branch to offer employees instant access to their earnings via the Branch app.

Branch is one of a few apps out there that lets hourly workers — who often live paycheck to paycheck — get faster access to much-needed cashflow. DailyPay, which we’ve written about before, is another popular one.

I see an uptick in restaurants making it possible for employees to use these types of apps in future. As everything in the previous section of this newsletter suggests, the restaurant model is rapidly changing, and it’s hard to guess now which formats are most likely to be around next week, next month, or even next year. That means it’s also hard to predict how many people a restaurant will need on staff, and how many hours those individuals can work.

With so many questions up in the air, the least restaurants can do is integrate with one of these apps to get their employees paid faster.

ID on the Glass, Please. The New Normal of Walmart Grocery Pickup

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Though I wasn’t even going into the store during my grocery pickup from Walmart this week, I still wrapped myself in a facemask and gloves. Mainly because I was buying alcohol, and last time I did so from Walmart, I had to talk directly with a worker in a situation that was way closer than six feet, and I had to sign for the booze with my finger on a device that presumably had been touched by a ton of other people that day.

But it turns out that a lot has changed in the past few weeks and, at least at my store, Walmart was being more aggressive about safety than even I was. Gone was the tablet to sign; instead the pickup worker asked me to stay in my car, roll up my window and press my ID up against the glass.

Additionally, I saw someone, who I presume was a supervisor, shout out to a customer and worker that they were too close and needed to stay six feet apart.

I can’t speak for the working conditions inside or more broadly — Walmart doesn’t have the best reputation for the way it treats its workers — but from a grocery pickup standpoint, my Walmart is taking COVID-19 very seriously.

There were more changes that I noticed on this trip. Walmart added a bunch of new pickup spots as well. They, like every other grocer, are grappling with ways to keep up with the surge in online grocery shopping. Walmart reportedly saw a record number of downloads for its grocery app over the weekend, surpassing Amazon.

While Walmart scrambles to keep up with safety protocols and meeting demand, there are some signs it’s struggling. I had issues with the app this week, both ordering and coordinating pickup. Like, big issues that even re-installs wouldn’t save. This was confirmed on two separate calls with Walmart customer service, both of whom said there were widespread problems with the app.

Walmart isn’t the only grocer struggling as it tries to meet demand. Amazon announced yesterday that new Amazon Fresh and Whole Foods customers have to wait to be invited before getting deliveries. And ShopRite is putting online customers into a virtual waiting room before they can shop.

Accelerated is almost too soft a word for what COVID-19 has done to grocery e-commerce. With 31 percent of US households using online grocery as of last month, compared with 13 percent in August, retailers experienced a year’s worth of growth in a matter of weeks. Problems in the supply chain and logistics were bound to arise.

Thankfully, the hiccups I’ve encountered have been minor and few. Since I live in a more rural area, grocery delivery is hard to come by, and Walmart pickup has been a godsend for my family. I appreciate those workers still showing up everyday and stocking my trunk. I wish there was an option to tip them, but hopefully they can see my sincere appreciation through the driver’s side window.

Can a Software Upgrade Save Food 3D Printing?

3D printing food has long held the promise of unlocking sci-fi-like benefits for society. Think of a machine teleporting sushi or creating highly customized food on the spot made just for you.

But 3D food printing has stalled in recent years, and as Spoon Founder Mike Wolf reported this week, the answer to kickstarting it might be better software, writing:

[Marine Coré] Baillais, the founder of a French 3D food printing consultancy called The Digital Patisserie (La Pâtisserie Numérique), told me that the reason general purpose 3D printing software doesn’t work well is it’s designed to print with \materials like plastic filament, not food paste. This usually leads to less than optimal results because a food paste has unique characteristics that make it much different than filament.

It’s actually a pretty cool idea and you should check out his full story for more details (plus, Notre Dame inspired food printing).

During a Pandemic, Don’t Be a Pandummy

This should go without saying, but if there was ever a time to be kind and generous with one another, it’s during a deadly pandemic that is killing hundreds of thousands of people and destroying economies.

So we were a little disappointed when reading stories about customers tip-baiting Instacart shoppers; promising a big tip for grocery delivery only to remove it once the job is done. That is (*#$@$^ evil. Don’t do that.

Third-party delivery services, which had some sketchy business practices even during better times, got a bit of a slap on the wrist from the city of San Francisco this week. Mayor London Breed ordered a temporary cap of 15 percent on delivery fees third-party services can charge restaurants during the shelter in place. One would wish that a new rule wasn’t necessary for something like that, but… here we are.

We understand times are difficult, to say the least. Be kind where you can. It makes a difference.

This is the online version of our weekly food tech newsletter. If you would like to get The Spoon in your inbox, subscribe here.

Newsletter: Shapeshifting To Survive During COVID-19

We knew that The Spoon’s first ever Virtual Strategy Summit would be around COVID-19. After all, the virus is the reason we had to make the summit virtual in the first place. And not to toot our own horn, but we didn’t realize how great it would be.

More than 1,300 people joined us yesterday to hear a number of experts talk about the impact of coronavirus on the food and restaurant world, and more importantly, what businesses in this industry should be doing to navigate these tumultuous times.

If you couldn’t make it, you’re in luck! The entire day is archived and available to watch here. And to give you a taste of what we talked about, here are some highlights:

  • Restaurant owners need to act on the Paycheck Protection Program right now. Ryan Palmer, a lawyer with Lathrop GPM talked about the ins and out of the federal assistance program. TL;DR it’s complex, keeps changing and only has a limited amount of money, so restaurant owners need to read up and apply immediately.
  • “Shapeshift,” and “break even” are the key terms for restaurants right now, according to Robert Egger, founder of DC Central Kitchen, and chef Mark Brand. While the panel didn’t pull any punches about the reality of the situation, they did say this dire situation was a chance for the industry to change for the better.
  • So how does a restaurant adapt? Sterling Douglass, co-founder and CEO of POS integrator Chowly has helped a ton of restaurants transition to digital ordering and delivery. His advice? Prepare your staff, get set up with all the delivery companies, and get virtual.

But aside from the great talks throughout the day, part of the “fun,” if such a word is applicable given the seriousness of the topic, was the direct interaction with the people who virtually attended. We got a ton of great questions and comments and even though no one was in person, the whole day felt very much alive.

A big thank you to Kitchen United and Luncbox.io for helping make the day possible, and thank you to everyone who attended. Given how well the day went, and how likely it is that social distancing will continue into the foreseeable future, I’m sure we’ll be putting on another Virtual Summit soon. Hopefully on a much happier topic.

Photo: Catherine Lamb

In this pandemic, people are turning to scratch cooking

We made our first loaf of homemade sourdough bread in the Albrecht house over the weekend. And from the data, or even a quick perusal of social media, we are not alone. In fact, we are more like a cliché at this point given the amount of scratch bread popping up on Instagram.

But even hard numbers back up that more people are making bread from home. Spoon Founder Mike Wolf dug into said numbers over the weekend and found that not only are searches for bread recipes spiking, but so are sales of bread makers. Since we’re stuck at home, we’re looking for a little comfort (food) in these uncertain times. As Mike wrote:

Naturally, part of the interest in making things like corn bread and cookies is due to most of us having more time on our hands, but I also have to wonder if the rapid growth in interest in things like making things like tortillas and basic bread is because some consumers worry they might have to make these staples at home for the foreseeable future.

Check out the full story and see if it hits home for you.

One-way aisles and no cashiers? What will grocery stores look like?

With most people sheltering in place, grocery e-commerce is surging. But when it’s okay to go back out in public, how many corona-inspired changes will remain at the grocery store?

Measures like plexiglass shields and one-way aisles are among the changes to grocery retail meant to limit both shoppers and the frontline workers from exposure to the virus. But once this pandemic recedes, should we get rid of them? They seem like pretty good, evergreen ideas, and could be helpful even during much more mild cold and flu seasons.

I thought about post-pandemic grocery shopping over the weekend, and would love your two cents on it. What changes do you think will be permanent part of our trips to the grocery store a year from now? Leave a comment and let us know!

Newsletter: And Now for Some Cool Food Tech News

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Usually in these newsletters, I try to tie together a bunch of disparate threads into a unifying story that makes me sound soooper smart. What I don’t like to do is just recap stories we’ve published on the site.

But I’m breaking that rule today, kinda. Yes, I’m recapping a bunch of stories that we have published recently on The Spoon, but they are all unified by a theme of startups getting things done. These companies are pivoting and even launching in the blurst of times.

Check out these cool examples of food tech companies making the most of our bad situation.

  • The Great American Takeout (part 2) encourages you to help put some money in the pockets of your local restaurants.
  • Pepper is a NY-based startup that pivoted from restaurant supply management to connected restaurant food suppliers directly to consumers.
  • Anycart launched a shoppable recipe platform to help all of cook different kinds of meals while sheltering in place.
  • Kitchen United is holding an online seminar to help restaurants understand how the just-passed stimulus bill can help them.
  • GoSun is expanding from solar cooking to portable water filtration
  • Our very own Jenn Marston put together an awesome list of restaurant tech deals (while you’re at it, sign up for her new restaurant tech newsletter!).

What cool thing is your food tech company doing? We’d love to know! Drop us a line and tell us.

Join us for our online COVID Strategy Summit

Perhaps you’re inspired by the above list of companies making COVID-driven moves, but aren’t sure what your company’s next steps should be. If so, you should join us on April 6 for our COVID-19 Virtual Strategy Summit for Food and Restaurants.

No travel required to get there and 100 percent socially distant, this online summit will features talks and fireside chats from leading experts including:

  • Chef Mark Brand – Founder of Save-On Meats and creator of the Token Program to feed those in food insecure situations
  • Sara Roversi– Founder of the Future Food Institute
  • Dana Gunders – Executive Director of ReFED
  • Paul Freedman – Professor of History at Yale University and author of American Cuisine: And How It Got That Way
  • Ryan Palmer – Partner at Lathrop GPM and chair of firm’s Restaurant, Food, and Hospitality group

Save your spot today!

Tip your delivery driver!

Instacart’s gig workers, known as Shoppers, called for a nationwide strike earlier this week. They were calling attention to and looking to force changes to their working conditions during this time of global pandemic.

Instacart responded with some concessions and new safety protocols, but it wasn’t enough to stop workers from striking — a move that was followed by work stoppages at Whole Foods and Amazon warehouses.

The reason I bring this all up is to reinforce that these workers are showing up and doing their job in dangerous times. Be kind to them, especially if you have the ability to keep your job and work from home. Be kind, and tip them as generously as you are able.