“Eighty percent of people don’t know what they’re making for dinner at 4 p.m.” Byte’s co-founder Lee Mokri told the Spoon. But with this new partnership, they don’t have to — they can swing by one of Byte’s smart fridges in their office or building lobby, swipe their credit card, and grab a Chef’d meal kit on the way out their door.
Each Chef’d kit contains two (or more) servings of ready-to-cook, pre-portioned ingredients. Mokri said that Byte fridges would have meal kits on 1-2 of their shelves, the remainder of which would feature the same healthy food and drinks they’ve been stocking. They’ll also be debuting two stand-alone Chef’d fridges, which can fit roughly 20 meal kits.
A big gripe of meal kit service users have is that they get locked into a delivery subscription from the get-go. Which is one reason why meal kits are making the move into retail; people get the pre-packaged convenience of a kit, but they can pick them up day-of depending on their mood and schedule. The Chef’d/Byte partnership takes this convenience one step further but cutting out the grocery store stop and bringing the meal kits to them.
Byte isn’t the first to figure out that people want meal kits on-demand, without the subscription strings. Meal kits are the second most popular item at Amazon Go’s cashierless retail store in Seattle (and soon SF and Chicago). Byte basically brings the convenience of Amazon Go right into your office, shortening the retail journey to a few mere feet. “We’re solving for immediate satisfaction,” said Mokri.
This partnership is a savvy move by Byte to forge a new revenue channel. We wrote about Byte’s journey to reinvent of the vending machine a few months ago. The San Francisco-based startup launched in 2015 with an aim to bring accessible, fresh, and healthy food into offices. Workers can walk up to a Byte fridge, scan their credit card to unlock the door, then select as many items as they’d like from their offerings (like Blue Bottle coffee and Sunrise Sandwiches). When they close the door, the fridge scans all remaining goods and figures out what was taken, then charges the worker accordingly and sends over a receipt.
Byte’s fridges cost $500/month to rent, which includes the services of them restocking the fridges daily (often in the middle of the night) and taking away any uneaten food for donation at the end of the day. Since Byte absorbs all the risk of food waste, they’ve developed a demand algorithm to optimize their stocking and pricing practices — in fact, Mokri said that they have three patents.
They also license out their fridges and tracking/stocking technology to other companies. The service is completely turnkey; the licenser buys a Byte smart fridge for $5,500, pays a small monthly fee, and is then free to brand it and stock it with their own goods. Partners also have access to Byte’s dashboard and stocking algorithms. So far, Byte has roughly 100 of these licensed fridges, and is piloting more.
It’s also par for the course for Chef’d, a white label meal kit service that seems to be consistently innovating when other meal kit companies are struggling. Last month they partnered with Innit to provided guided cooking for their meal kits, and they capitalized off the slow cooker trend with their recent Campbell’s partnership. Chef’d already offers the option to purchase their meal kits sans subscription, and by teaming up with Byte Foods they’re positioning themselves as even more convenient.
Byte plans to roll out Chef’d kits into all of their 500+ locations over the next six months. They have raised a total of $10 million so far and are beginning to raise their Series A round.