Saudi Arabia’s sovereign-wealth-fund invested $400 million into Travis Kalanick’s CloudKitchens startup, according to a new report by The Wall Street Journal. The fund’s agreement was completed in January and could value CloudKitchens at $5 billion.
The sovereign-wealth-investor was also an early backer of Uber, which means Kalanick, who was ousted from the latter in 2017, is reunited with a former investor.
Like Kitchen United, Zuul Kitchens, and others, CloudKitchens operates a network of ghost kitchens facilities restaurants can use to fulfill delivery orders placed via DoorDash, Grubhub, etc. The company also has several of its own delivery-only restaurant concepts, which it also runs out of these kitchens.
According to the WSJ’s sources, the sovereign-wealth-fund, known as Saudi Arabia’s Public Investment Fund (PIF), has helped CloudKitchens expand around the globe, including multiple U.S. cities as well as China, India, and the UK. A spokesman for PIF declined to comment to the WSJ on the story.
The deal had reportedly been in the works since 2018, when Kalanick started discussing it with PIF’s governor Yasir al-Rumayyan, who also sits on the board of Uber. It’s also one that’s steeped in controversy, given the murder of journalist Jamal Khashoggi. The investment in CloudKitchens is the PIF’s first known deal in Silicon Valley since Khashoggi’s killing, according to the WSJ.
On its website, CloudKitchens promises potential restaurant parters things like lower upfront and operational costs. The site lists just seven restaurant brands the company works with and precious-little information in terms of where CloudKitchens actually operates facilities. Secrecy seems to be the name of the game when it comes to how Kalanick runs this business. The company forbids employees to list any affiliation with CloudKitchens in their LinkedIn profiles, and Kalanick himself doesn’t grant interviews on the topic. In that sense, keeping a $400 million investment from a controversial alliance is right in line with how CloudKitchens is choosing to run its business. According to the WSJ, the investment has been “closely guarded” and known to just a few executives at CloudKitchens.
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