One question I ask food robot companies, especially the startups that build meal-making robots, is whether they are a food company or a technology company. The answer to that question has a definite impact on a startup’s ability to not only get to market, but scale up once there.
If a robot startup is a food company then chances are good that they will try to build their own food brand. Some example include robotic restaurant Spyce (which just opened its second location last week), automated vending machine PizzaForno, and Creator (R.I.P.). Each of those business is creating a unique menu with their own takes on popular foods (bowls, pizza, burgers, respectively).
If a startup is a technology company, then they are just interested in building the robotics that other brands will use. Some examples of this are RoboEatz‘s cafeteria style meal assembler, Miso Robotics‘ Flippy the griller/fry cook, and Highpper‘s self-contained autonomous kitchen. These companies aren’t interested in making a menu, only helping other companies make their food more effieciently.
The direction a robotics startup chooses will impact their ability scale, an especially important factor if they take VC money. Primarily, it’s an issue of workload and focus. If a robot manufacturer is also trying to build a food brand it has to juggle (and scale) two entirely different lines of business. It must design, manufacture and maintain the robots and design menus. figure out food supply chains and logistics.
It’s hard enough to scale just the production of robots, scaling up a restaurant biz on top of that is a much harder task. It’s not that it can’t be done, it just requires additional operational skills, different sets of expertise and more money.
Of course, some robotics companies are choosing a hybrid model where they do both owner operator and co-branded robots. Piestro, Chowbotics and Yo-Kai Express are all using this blended approach where they run some of their own machines but also license out the platform to other, better-known restaurant brands. This allows the robot company to put a few of its machines in operations to show the benefits, and then build up the biz dev relationships on the backs of any success.
My guess is that licensing technology to a third party will become the dominant business model for most robotic startups as the industry matures. This means less overhead for a company (none of the food side of the business), and it can leverage a more powerful brand name. Hungry consumers will be more inclined to buy a pizza from a Domino’s-branded pizza robot than from a new brand they’ve never heard of. This, in turn, should create more revenue early on, allowing robot companies to raise more money and scale up their operations more quickly.
Ultimately, 2021 is going to be a big year for food robots and there will be many different paths taken. For those of you with young food robotics startups, now is a good time to ask yourself what business you want to be in.