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The Spoon

Daily news and analysis about the food tech revolution

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Kristen Barnett Launches Hungry House, an ‘Anti-Ghost Kitchen’ Ghost Kitchen

It seems a day doesn’t go by nowadays without a new ghost kitchen concept popping up.

While all that growth can be exciting, the ghost kitchen land grab has its downsides, at least according to Kristen Barnett. The former COO of ghost kitchen startup Zuul told me today in a video call that the industry’s rapid expansion has often meant low-quality food, a lack of transparency, and, well, just way too many chicken wing restaurants.

To counter this, Barnett has launched a new company called Hungry House, which she describes as an ‘anti-ghost kitchen ghost kitchen.’

What does that mean?

“We are actively being intentional about some of the more negative sides of the ghost kitchen industry that the public has come to know,” said Barnett. “Hungry House really was created as a reaction to that, seeing a way to flip those maybe less than ideal characteristics of the industry on its head and say ‘No, what happens if we infuse transparency, we tell customers it’s Hungry House making the food, we have a physical storefront that people can actually order at and see the kitchen and see the team?'”

To do all that, Barnett’s plan is to be transparent about where the food is made and who is making it and to have tight control over the quality. That means growth will be purposeful in the beginning as the company builds its business one kitchen – and chef – at a time.

“I wanted to create Hungry House as the partner of choice for what I believe to be the next generation of culinary leaders who have different career paths than in the past.” According to Barnett, that next-generation leader might be a food truck operator or someone who has proven themselves a culinary innovator on social media but may not want to run a full restaurant.

One such creator is Woldy Reyes.

“Woldy is this incredible Filipino chef who has really well attended pop ups throughout Brooklyn,” said Barnett. “He’s known for his signature menu items, yet he’s been running a catering business, not necessarily operating restaurants, and he’s been able to do all of that. So it made a lot of sense for him as someone who has really well developed recipes, but didn’t necessarily know exactly what it would take to run a restaurant and figuring all of that out wasn’t necessarily in his career plan.”

Barnett’s approach to creating high-touch kitchens and working closely with emerging voices with strong culinary visions is a marked contrast to the high-profile celebrity virtual restaurant concepts being spun out these days.

“These celebrities are definitely capitalizing on great content,” said Barnett. “But is it necessarily going to be executed in a way that creates true long term value in a food brand? I don’t think so. I don’t think many of these are going to be around.”

Barnett’s plan is slowly expand Hungry House over the next year into Manhattan and see where it goes from there. She said the company would be raising a seed round to grow the team, build out their tech stack and expand into new cities.

At the top of her list? LA, New York and Miami.

“With those cities locked down, really anything as possible when it comes to using our model to launch high quality brands that come from either chefs, celebrities, CPG brands,” said Barnett. “That’s the type of world I want to create – where there is true innovation, there are new things being launched, and new stories being told.”

You can watch my full interview with Barnett below:

The Spoon Talks with Hungry House Founder Kristen Barnett

Kitchen United Acquires Zuul: Has The Wave of Ghost Kitchen Consolidation Begun?

Yesterday, ghost kitchen operator Kitchen United announced they had acquired Zuul, a ghost kitchen technology and consulting services company, for an undisclosed sum.

According to the announcement, Kitchen United will bring over the executive team and transition Zuul’s New York City facility to a Kitchen United MIX kitchen center.

The company also announced that it would integrate Zuul’s ZuulOS technology platform. From the announcement: ZuulOS enables operators to create their own virtual food halls and fulfill multi-brand orders effortlessly. The company also powers native online ordering and batched deliveries with a partner network to provide an efficient delivery model that will marry well with Kitchen United’s proprietary technology platform MIX.

While the addition of a NYC location and the executives is important, much of the announcement focused on the addition of Zuul’s technology platform, ZuulOS, to the Kitchen United offering. What’s interesting is Kitchen United already has its own tech platform called MIX, which is, well, a mix of both consumer-facing elements as well as some back-of-house delivery management pieces.

So what does Kitchen United get with ZuulOS? ZuulOS has white-label consumer-facing elements, but its core is a multi-brand virtual restaurant management platform. ZuulOS, which has its roots in the acquisition of OnTray in 2019, has accounting, menu-building, and kitchens operations components. Throw in Zuul’s consulting services arm, and it rounds out Kitchen United’s ability to spin up new virtual food halls for companies using its technology and shared kitchen products.

For Zuul, while it can’t be said for sure (since terms were not disclosed), chances are the acquisition is probably not the type of exit imagined when they announced they had raised $9 million just over a year ago. Six months after the funding news, it became clear the company was searching for itself as it announced the ZuulOS platform and transitioned away from being a ghost kitchen operator (aside from the one NYC location) to being a Saas/platform company. The news of this deal marks the completion of the company’s journey as it finds a home with one of the industry’s biggest players.

Let the ghost kitchen market consolidation begin

While this is one of the most significant acquisitions so far in the ghost kitchen space, it’s likely only the start of a wave of consolidation.

Even as funding still flows into the ghost kitchen and virtual restaurant space, many operators have realized that running an extensive network of multitenant kitchens is a capital-intensive business. Much of the recent funding in the broader ghost kitchen and virtual restaurant space has gone to companies that are creating platforms that make it easy for restaurant brands to launch new virtual brands through hosted kitchen models. While some companies, like Reef, continue down the heavy capex path powered by huge raises, venture and corporate capital has started to migrate towards hosted kitchen models and virtual restaurant brands that can take advantage of underutilized kitchen capacity in existing QSRs or independents.

This doesn’t mean we won’t continue to see lots of creativity over the next five to ten years in which operators build both new kitchens with limited front of house and completely dark kitchens. The realization in the restaurant, grocery and food service market that the traditional restaurant model of building a kitchen and front of house for every single location is outdated in the age of delivery and digital ordering is still a valid one, and the great recalibration towards new models like hub & spoke and virtual food halls will continue apace.

Part of the big shift towards the digital dining reality of today is finding out what works best for customers and its operations while optimizing the business model from a capex and opex perspective. For their part, Kitchen United, one of the early pioneers in the space, has made the transition from a ‘heavy capex’ model to one that is more flexible, working with everyone from big grocery store chains to set up ghost kitchens to bringing food hall formats to big shopping centers. This deal should only help the company remain a key player as the industry evolves and finds its way.

2020: The Year the Ghost Kitchen Got Complicated

As an old saying goes, “Anything can happen, and most usually does.”

And it sure did happen in 2020 for the restaurant industry. Pandemic. Dining room shutdowns. Permanent closures at alarming rates. A seismic shift to takeout and delivery formats. More shutdowns. Complete uncertainty over the state of indoor dining coupled with growing panic over the state of the independent restaurant. 

Personally, I think it’s foolhardy to try and meaningfully condense what happened to restaurants in 2020 into a few hundred words. So as we close out this dumpster-fire of a year and head to 2021, I’ll pinpoint one part of the biz that’s been talked of constantly these last several months: ghost kitchens.

Right around the end of 2019, we were already fixated on the ghost kitchen. In a predictions piece I wrote at the time, I said, “This is part of the restaurant industry that will change rapidly over the next year as it becomes more commonplace among both restaurants and consumers.”

All that wound up being true in 2020, not because I’m some predictions wizard but because a global health crisis forced the restaurant industry into off-premises formats like takeout, delivery, and drive-thru. Because these formats don’t require a dining room to function, they are inherently suited to the ghost kitchen setting. Ghost kitchens, after all, were designed to serve to-go customers, typically those ordering through mobile apps and other digital properties. 

But one thing that was made clear in 2020: ghost kitchens are not the end-all, be-all savior of the restaurant industry. In fact, throughout the year, multiple restaurant industry figures raised questions about the commissary model in particular.  

Back in March, when COVID numbers were initially rising, former Kitchen United CEO Jim Collins cautioned restaurants to think hard about whether their business generated enough demand to justify the cost of a ghost kitchen operation. Similarly, Andy Wiederhorn CEO of Fat Brands, said in July that ghost kitchens “simply work better for brands that have existing fanbases” (a point he repeated at our ghost kitchen event earlier this month).

I bring up these reservations not to further cast a cynical shadow but to illustrate another important takeaway from 2020: that because there are still so many uncertainties for restaurants over the traditional commissary model, other forms of the ghost kitchen concept have emerged that make running an off-premises business more feasible for more types of restaurants. 

Over the last year, we saw the growing popularity of the so-called “dark kitchens.” These are underutilized kitchen spaces restaurants are using to fulfill their delivery and off-premises orders. Fat Brands is one notable example of a company using its own restaurants as dark kitchens for sister brands. Ordermark/NextBite, meanwhile, built out its business this year of pairing restaurants with unused kitchen space in order to deliver (literally and metaphorically) more meals from virtual restaurant concepts. Another great example is Hi Neighbor, a San Francisco restaurant group that had to close because of the pandemic. Its response was to use one of its shuttered kitchens to accept and fulfill delivery orders for its own virtual concepts. Hi Neighbor is just one local example of a trend happening nationwide.

In the second half of 2020 (right after Euromonitor predicted the ghost kitchen market would be worth $1 trillion by 2030), we saw massive amounts of investment dollars flow into the space, from Zuul’s $9 million fundraise to a $120 million investment in the aforementioned Ordermark to the $700 million raised by Reef. There were plenty of other financial milestones in between those figures.

Alongside those investments, even more formats emerged of what a ghost kitchen might look like and how it could become more efficient. ClusterTruck, which has operated a vertically integrated delivery business for years, teamed up with Kroger to turn the latter’s deli counters into a kind of ghost kitchen. More recently, Crave Collective opened in Boise, Idaho to show us what a fine-dining take on a ghost kitchen looks like. And the QSRs, finally got onboard, with everyone from Chipotle to McDonald’s unveiling new store formats that minimize or eradicate the dining room and are in effect their own version of a ghost kitchen.

The most unanimous takeaway of the year was this: the ghost kitchen, in its various forms, is here to stay. We may be inching closer to a widespread vaccine for COVID, but the restaurant industry has already completed the shift to off-premises-centric businesses. There’s no going back at this point.

Even so, we leave 2020 and enter 2021 with plenty more questions when it comes to how one best runs a ghost kitchen. What is the role of the chef — an artist, by rights — in this off-premise-centric new world? How long will ghost kitchen operations be tied to third-party delivery services increasingly bent on calling the shots for restaurants? What about the mounds and mounds of packaging waste being generated by all this innovation?

If 2020 was a year about making the ghost kitchen more efficient, 2021 should be about the role the ghost kitchen plays when it comes to the restaurants, chefs, drivers, and other people whose livelihoods are now tied to it.

Event Wrap: Restaurants Still Need Brand Equity, Brick and Mortar in a Ghost Kitchen Strategy

This week, The Spoon gathered a wide variety of restaurant industry players together to discuss the most pressing questions the restaurant biz faces right now around ghost kitchen adoption. Throughout the day-long virtual event, restaurant operators, tech companies, virtual restaurant owners, and ghost kitchen providers themselves weighed in on a range of topics, from the economics of going the ghost kitchen route to building a delivery-friendly menu to the tech powering the concept.

One of the most recurring questions to surface during the event was this: Do you still need a physical restaurant in order to make the economics of a ghost kitchen operation work?

Panelists almost unanimously agreed that, at least right now, you do.

“If you go on a delivery app only and you don’t have a brick-and-mortar presence, you better have brand equity,” Andy Wiederhorn, CEO of Fat Brands, emphatically stated during the event. And that brand equity is not easy to build. (More on that in a minute.)

Others pointed to the industry’s reliance on third-party delivery apps (DoorDash, Uber Eats, etc.) as a huge hurdle to running a 100 percent delivery-only restaurant that actually makes money. “When you move 100 percent delivery only, the economics you have with third-party platforms is going to matter more,” said Kristin Barnett, Head of Strategy for NYC-based Zuul Kitchens. On the same panel, Kitopi cofounder and chief revenue officer Bader Atul agreed there is a “strain on profitability” when you attempt to limit a restaurant’s entire existence to third-party delivery apps. This is because it’s difficult to offset the sky-high and highly controversial commission fees delivery services charge restaurants (up to 30 percent per transaction, in some cases).

For now, at least, restaurants should consider what multiple panelists called the “omnichannel” approach. Some ghost kitchens, like those of Kitchen United and Boise’s recently opened Crave Collective facility, offer pickup options in addition to delivery. Big brands, meanwhile, have the obvious advantage here, since they have deep pockets and a long history of brick-and-mortar business to go alongside delivery. If they’re not already in a certain market, as Chick-fil-a wasn’t when it started serving the California Peninsula area via its DoorDash Kitchens operation, existing brick-and-mortar presence elsewhere can offset the cost.  However, Zuul’s Barnett pointed out that smaller restaurant chains, such as those that operate out of Zuul, can also take advantage of the omnichannel approach. 

Other ghost kitchen providers, including Kitopi and Reef, operate off an entirely different model from the normal commissary kitchen by handling all of the operations of fulfilling an order and the restaurant gets a royalty fee. This method provides restaurants the opportunity of trying a ghost kitchen operation out without having to commit their own labor to the process.

Still others, including Alex Canter of Ordermark and Nextbite, suggested we are fast-headed towards a day when running a 100-percent delivery-only restaurant will be not just feasible but the norm. Nextbite, one of his companies, operates a portfolio of delivery-only brands and helps restaurants add these brands to their own operations. During this week’s event, Canter referenced one Nextbite client that had incorporated five of those virtual concepts into their restaurant and were doing “10 to 15 times more revenue through those brands” than via their own. He said more and more, his company hears clients ask whether they even need their brick-and-mortar stores anymore.

But part of the success of a virtual brand will depend on how well it can build the aforementioned brand equity—another major takeaway from this week’s event.

Multiple panelists agreed that running a restaurant out of a ghost kitchen is more than simply sticking a menu online and waiting for the customers to come. They won’t, if an online menu is the long and short of your branding efforts. Just as with brick-and-mortar restaurants, virtual eateries in ghost kitchens and/or dark kitchens need their own “brand identity,” to use a marketing cliche, something that sets it apart from the dozens of other similar options out there.

We returned to a chicken wings example again and again throughout the day. Your virtual chicken wings joint needs a compelling story around its origins, ingredients, and even basic marketing components like name and visual representation. Without those brand identity elements, your virtual chicken wings restaurant has little chance of standing out amid the dozens of other chicken wing offerings on delivery marketplaces. See ClusterTruck, who was at our event, as an example of a company that has mastered the art and science of branding a virtual restaurant.

Our event covered dozens of other topics outside of these two big takeaways. To watch videos of the panels and access more content, head over to our Spoon Plus channel and become a subscriber.

Zuul Teams Up With Thrillist to Launch Rotating Ghost Kitchen

Ghost kitchen operator Zuul announced this week it has joined forces with lifestyle brand Thrillist to launch a “rotational ghost kitchen” offering delivery exclusives from top NYC chefs and restaurants. The program will run on Wednesday, Thursday, and Friday nights from Dec. 9 – April 16, according to a press release sent to The Spoon. 

A series of 10 different NYC restaurants will each hold a two-week residency offering exclusive delivery-only meal offerings made out of Zuul’s ghost kitchen facility in Manhattan’s SoHo neighborhood. The idea is to highlight the ghost kitchen concept — which quickly evolved from an optional add-on to a must-have for many restaurants — as an important element of the pandemic-era restaurant businesses. 

Zuul and Thrillist said in this week’s press release that the program is also a way to lend support to struggling restaurants as they fight to keep the lights on in the wake of new COVID-19-related restrictions. Full-service restaurants have been hit particularly hard over the last several months, since the experience they historically offer has been tailored to the dining room and their food does not always travel well. The Zuul/Thrillist program is meant to help these restaurants “reinvent” themselves to better fit into a restaurant biz centered on off-premises orders.

To that end, Thrillist will cover the costs for food ingredients, labor, packaging, and delivery for participating restaurants. Those restaurants will be able to take advantage of Zuul’s all-in-one ghost kitchen facility, which provides not only space to make the food but also the technical infrastructure to fulfill delivery orders. That in turn will let Zuul show its ghost kitchen concept to more restaurants, a wise move considering the company’s ambitions to expand across NYC.

Customers can order from these rotating ghost kitchens here. For the swag-lovers out there, all orders contain “a special kit” that includes a t-shirt designed by a local artist, a reusable cutlery set, portable wine tumblers, and an insulated bag. 

Speaking of Ghost Kitchens…

Register for our Ghost Kitchen Deep Dive event on December 9th. Tickets are limited, so better hurry!

NYC Ghost Kitchen Company Zuul Launches a Virtual Food Hall

NYC-based ghost kitchen operator Zuul announced this week that its virtual food hall, Zuul Market, is now live.

The new initiative is a cross between an online marketplace and a white-label delivery platform. The marketplace sells a limited number of items from restaurants that are currently members of Zuul’s ghost kitchen facility in SoHo, including Junzi Kitchen, Stone Bridge Pizza & Salad, and Sarge’s Deli. Zuul has also worked with its member restaurants to co-create virtual brands, which are also available through the marketplace. For example, Stone Bridge also operates the virtual-only Rival Sandwich Co.

All food is prepped and cooked in the SoHo kitchen facility. Zuul then delivers the food at scheduled times to drop-off points located in office buildings as well as residential properties around NYC. Zuul controls the entire process, from order processing to fulfillment to the last-mile delivery.

The idea is to provide a more efficient system for delivery, where meals from multiple restaurants going to multiple different people can be bulked together and taken to a single location. To do this effectively, Zuul has partnered with Silverstein Properties and Broad Street Development, both major property developers in NYC that own both office buildings and residential properties. Zuul Market menus will be available to residents and employees throughout those companies’ properties. For example, Silverstein integrated Zuul Market into its Inspire app for tenants as a building-wide amenity across its buildings. 

How successful this delivery strategy is in office buildings depends a lot on how many people actually wind up going back to the office. Right now, it’s not many. But residential properties could be a lucrative area for delivery and commerce during the pandemic, and probably after. Folks are spending more time at home these days, and with colder weather coming, that’s likely to increase. So whether it’s automated convenience stores, contact-free delivery pods a la Minnow, or a virtual marketplace like Zuul’s, more and more companies are finding new ways to bring the restaurant experience into the home. 

Zuul said it plans to build additional food hall partnerships with both restaurants and properties in addition to more ghost kitchen facilities across NYC in the future.

Ghost Kitchen Network Virtual Kitchen Raises $20M

Virtual Kitchen, a company founded by two ex-Uber executives, has raised $20 million in new funding, according to a filing with the SEC (h/t Restaurant Dive). The round was led by Founders Fund and brings Virtual Kitchen’s total funding to $37 million. 

Virtual Kitchen runs multiple “delivery-optimized kitchens” where restaurants can rent space and also take advantage of the company’s technology to scale up operations quickly. Delivery fulfillment is done through partnerships with Grubhub, Uber Eats, Postmates, DoorDash and other third-party services. 

It’s unclear at this time what Virtual Kitchen will do with the new funds, though Restaurant Dive suggests the San Francisco-based company is likely to focus on expanding its network of ghost kitchens.

Now would certainly be the time to do that. As we detailed in a recent Spoon Plus report, the market for ghost kitchens is enormous — trekking towards $1 trillion by some accounts. As a business model, the ghost kitchen was already becoming an attractive option for more and more restaurants before the COVID-19 pandemic ever hit and decimated the restaurant industry. Since then, delivery and other off-premises formats have become priorities for large chains and mom-and-pop joints alike, and there’s no setting more logical for fulfilling all these to-go orders than a ghost kitchen. 

Given all that, the recent activity in the ghost kitchen space shouldn’t surprise. Kitchen United continues to expand across the U.S. Kitopi raised $20 million this year. Zuul raised $9 million for its NYC-focused ghost kitchen operation, Dubai-based iKcon raised $5 million, and that’s but a smattering of the recent developments in this sector. 

Virtual Kitchen’s new funding follows last year’s $15 million investment from Andreessen Horowitz and Base10 Partners. 

Can Ghost Kitchens Save the Vanishing Restaurant Biz?

“Perhaps we should stop using the term ghost kitchen. Ghosts are rarely seen, but ghost kitchens? Well, they are popping up everywhere.”

Spoon Editor Chris Albrecht was half-kidding when he wrote that line earlier this week, but he might have been onto something. Ghost kitchens, a concept that only really started turning heads one year ago, are practically unavoidable these days in a conversation about the restaurant industry. 

In the past few weeks alone:

  • Foodservice distribution giant US Foods launched its own ghost kitchen service that will provide restaurants “guidance and resources” to open their own kitchens.
  • Gig economy engagement platform ShiftPixy unveiled a ghost kitchen incubator that connects restaurants with physical kitchen space and the tech to run a ghost kitchen.
  • Dubai-based iKcon, raised $5 million to expand its kitchen network and the proprietary tech stack that goes with it.
  • Fat Brands announced that Johnny Rockets, a brand it intends to purchase for $25 million, will expand via ghost kitchens, many of them inside the kitchens of other Fat Brands restaurants.
  • Sweetgreen said it is testing the ghost kitchen concept out by working from a Zuul kitchen in NYC.

And those are just the highlights.

What’s noteworthy here is not that a bunch more restaurants and food industry companies have hopped aboard the ghost kitchen train. It’s that there are a fast-growing number of options when it comes to where and how a restaurant can open a ghost kitchen. With a company like iKcon, for example, a restaurant’s ghost kitchen essentially becomes a franchisee. Renting space from Zuul or another third-party kitchen provider is another way. Operating one brand out of the kitchen of a sister brand is perhaps the most intriguing concept on this list, and one we’ll see a lot more of in the future.

Add to all that choices around location, technology, and figuring out if they even have enough demand to warrant a ghost kitchen, and restaurants have a lot to consider in today’s off-premises-centric world.

What’s more, those restaurants are being forced to consider their choices when it comes to ghost kitchens. The pandemic has decimated the dine-in business for both large restaurant chains and smaller independent businesses. Recovery from the fallout will be slow, and the idea of most customers returning to brick-and-mortar restaurants seems less possible each week. Given those factors, more restaurants will have to consider either supplementing their existing operations with ghost kitchens or pivoting their entire model to a virtual, delivery-only one.

I suspect this is just the beginning when it comes to types of ghost kitchens that rise out of the ashes of the on-premises restaurant experience. We’ve already seen restaurants employ countless amounts of creativity when it comes to running a restaurant during a pandemic and trying to create a concrete restaurant experience out of virtual tools. With the pandemic still very much a part of our lives, we will now see that creativity head for the ghost kitchen.

SipScience Raises Money to Reinvent the Bar

SipScience, a data analytics company specifically for the hospitality industry, is preparing to launch itself into the contactless payments realm by launching a new platform, Sip. 

According to a press release sent to The Spoon this week, there are two sides to Sip. The consumer-facing one comes in the form of an app that connects to a user’s digital wallet. The app lets said user find nearby bars and open a tab from their own mobile device, through which they can order and pay for drinks. When it launches, Sip will be available at participating bars and venues across the U.S. Bonus: those who sign up for a subscription will get half off their first 50 drinks ordered through the app.

For venues, such as bars and restaurants, the app is a new way to drive more traffic, and the accompanying SipSync analytics engine gives these places more data on in-venue customers. Brands, too, are provided with real-time purchasing data, which is not something a payments app normally provides.

The company said this week it had raised $1.3 million in SAFE notes. There is no official launch date yet for the app, which makes sense, given the state of in-person hospitality venues. Bars in many states remain closed, as to venues built to hold hundreds of people. 

Granted, no sane person would spend much time in a bar right now. But SipScience’s news suggests that folks start flocking back to their local watering holes, they’ll find a far more tech-driven experience waiting.

Restaurant Tech ‘Round the Web

Starbucks launched a digital traceability tool this week that lets customers learn more about their coffee, including where it came from and traveled, and the farmers and roasters involved in production.

Domino’s is hiring 20,000 more employees. That’s on top of the 10,000 the pizza chain said it was hiring right after the pandemic hit, and just goes to show you that the company’s delivery-centric business is alive and thriving. 

Grubhub has launched an online petition to commission fee caps and is reportedly going to run an ad campaign that calls the fee caps “food delivery taxes.” Grubhub says fee caps result in higher costs for consumers and ultimately hurt restaurants. 

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

The Food Tech Show: Ghost Kitchens, $1 Keto Cookies & the Magical Egg Cooker

The Spoon editors got together to talk about some of the most interesting food tech news of the past week (as well as complain about high-priced cookies).

Some of the stories we talk about on the pod include:

As always, you can listen to The Food Tech Show in Apple Podcasts, Spotify or wherever you get your podcasts. You can also download the show direct to your device or just click play below.

Zuul Raises $9M for More Ghost Kitchens in NYC

Ghost kitchen company, Zuul, announced today that it has secured $9 million in funding to expand its ghost kitchen operation across New York City. The company, which currently services downtown Manhattan will use the new money to begin operations across New York’s five boroughs.

Ghost kitchens (aka: dark kitchens, aka: cloud kitchens) are facilities that restaurants and other food brands can rent for delivery-only operations. Earlier this month, Euromonitor report predicted ghost kitchens could become a $1 trillion market by 2030.

A lot of that ghost growth is courtesy of the global COVID pandemic, which has forced the closure of many dine-in options for restaurants. As my colleague, Jenn Marston, who just published a premium report on ghost kitchens, wrote:

Much of the ghost kitchens’ rising popularity can be attributed to the rapid rise of the food delivery segment, which has been happening for some time now. Even more recent, though, are the economic fallout and changing consumer behaviors brought about by the COVID-19 pandemic. Put together, all these elements have accelerated the adoption of ghost kitchens much faster than what the industry expected even eight months ago.

This appears to be Zuul’s first round of funding, though the press release did not provide many details such as investors or how the $9 million is structured. This is, however, the latest move by Zuul, which acquired OnTray’s ordering technology in January, and partnered with Figure 8 to form a ghost kitchen consultancy in May of this year.

The company will need to bulk up its warchest, however, as there is plenty of competition in the ghost kitchen space including Kitchen United ($50 million raised), and CloudKitchens ($400 million raised), not to mention delivery companies like DoorDash getting into the ghost kitchen game.

Zuul is definitely striking while the ghost kitchen market is hot, now can it solidify its lead in NYC?