The Restaurant Report

Starship Tech a sidewalk robotic company is raising 100 Million in a flashStarship robots are revolutionizing food and package deliveries, offering people convenient new services that improve everyday life. Their ability to harness technology combined with experience providing services to millions of people makes this a reality today.Google accused of 'deceptive' online ordering practices by a restaurant groupA class-action lawsuit has been filed against Google alleging the tech giant infringed on restaurants' intellectual property rights and interfered with their customer relationships by using "deceptive online ordering practices." The suit was filed on behalf of Left Field Holdings, which operates several Lime Fresh Mexican Grill restaurants.Chains Longterm Impact From Russian ExitsStarbucks and McDonald's announced Tuesday that they are halting business activity in Russia following the country's invasion of Ukraine. Neither company has forecasted when their Russian stores could reopen. The Golden Arches has 850 restaurants and 62,000 workers in Russia and 84% of its Russian restaurants are company-owned. Starbucks has 130 total restaurants in Russia, all of which are licensed by but not owned by the company, according to data published by the Yale Chief Executive Leadership Institute on Tuesday.Welcome to the NFT Restaurant BoomChefs like Tom Colicchio are minting NFT pizzas, recipes, and even limited-edition gin bottles. But is the rest of the food world along for the ride?This episode sponsored by California Energy Wise & Dawn Professional®

Foodservice Tech Sell-Off - Affect on your restaurant?Lots of technology news this week and also a seismic shift in what we could be dealing with very soon if we see a potential recession and seven dollar a gallon gas. The landscape has erie similarities to an era when old school POS was displaced in early 2000. DoorDash buys Bbot to beef up in-store digital ordering capabilitiesDoorDash is acquiring Bbot, a hospitality technology startup that simplifies digital orders and payments processes, the company announced Tuesday. The terms of the deal were not disclosed.The deal will expand DoorDash's suite of first-party platform services, such as DoorDash Drive and DoorDash Storefront, to meet increased demand for integrated and simplified solutions. The aggregator also claims Bbot's technology will increase partner restaurant sales and reduce diner wait times to order and pay.I see this as an early validation that Bbot did not want to go the IPO route with the battering of foodservice tech companies that have fallen as much as two-thirds in less than a year with the likes of OLO and Toast.Next up is Toast - as CFO Elana Gomez states they are looking for tactical investments for market share growth. In my opinion, this is a bad strategy under the current economic overpriced landscape that is on the verge of a major hit as well as a shift from web 2 to web 3 that is clearly underway.The company is staying its course amid a broader sell-off in the cloud-computing sector since November and volatility in the broader markets in the wake of Russia’s invasion of Ukraine and lower margins. Toast’s shares are now in the $20 range, down from the $40 level in September that made it one of the largest IPOs of the year in restaurant technology.Paul's Take: This is a problem that we are facing right now in the tech sector with foodservice and one that will not be realized until 2024-25 which will then be too late. A caution in investing in this sector right now due to the fact we could see an early disruption of an industry that was forced into growth before they and the technology advancements of the future were ready. There are clear changes beginning to shift the tech landscape once again and the COVID bandaid of tech companies that have been thrust into these uncertain times wreaks of a bad situation brewing.This episode is Sponsored by Popmenu

Could third party be seeing the end of the party as more and more consumers are stressed with financial considerations and economic impact from inflation, interest rates, and global conflict?Operators are slowing down as well in terms of new restaurant openings. The slow return to normal and in-restaurant dining will have a slowing effect on the growth of third-party delivery.All that said, Door Dash recorded a 69% jump in revenue from 2020 to 2021, totaling $4.89 billion for the year, according to the company's full-year 2021 earnings results.The platform's losses also grew to $468 million for 2021 compared to 2020. DoorDash CFO Prabir Adarkar attributed this increase to the company's expansion into new verticals and investment in international growth.Trends are down and up as we break out some of the NRA's findings around the future consumer.More Restaurants Enter The MetaverseLast year, Applebee's experimented with NFTs as part of a "Metaverse Mondays” which had lackluster performance simply because they were new and first movers.The chief brand officer referred to the program as a low-risk, medium- to high-reward opportunity. He states going back to authenticity; the critical element is that it wasn't just a stunt or gimmick in terms of just an NFT that we put out there from our brand, but that we had that real-world component as well. The key for NFT and Metaverse use cases in the future will be real-world utility and the bridge that will enable how the market can develop for growth.Bringing in that real-world experience along with the NFT just made so much sense to be able to break through some of the noise that was happening as NFTs were starting to garner a lot of attention and a lot of activity from a lot of different brands.Panera also filed a trademark for the Paneraverse, and the potential of what they have in mind could be a big part of the brand's future. Listen to the podcast to learn more!

In today’s episode of The Restaurant Report, host Paul Barron chats with Rajat Suri, chief executive officer of Presto about the future of where technology is going in foodservice. Suri, an engineer by training, confounded Lyft and developed Presto while at M.I.T. in 2008. Presto over the years started building out a suite of products in three major areas, touch, vision, and voice which are all different ways of translating a physical action or physical event to digital data. Presto Voice is a human-like AI voice, an assistant to help manage labor shortage. Presto Vision, a smart AI-driven analytics to optimize your everyday restaurant operations, and Presto Touch, a guest facing technology. Barron asks Suri if off-premise including drive-thru, pick-up and curbside, how it is today is the new normal, he says, he thinks off-premise is underpriced and will see a higher cost over the next few years. As companies like Uber Eats and DoorDash costs go up and you will see a decline in the off-premise business. Suri says, “I think drive-thrus are going to do gangbusters everywhere, I don’t know if the world of people going back into dining rooms of restaurants that’s going to come all the way back because I think people have realized that drive-thrus are very convenient a lot of people are more addicted to that channel. The future looks very good.”Barron talks to Suri about what would be the technology that would immediately draw people back into the drive-thrus, Suri says, I think the drive-thru is set for a rocket transformation due to technology. Presto is working on a drive-thru experience where you can literally drive in and you don’t need to order or pay, you just pick up food. Presto’s computer vision cameras can recognize the person ordering, have your food order ready for you and send you a text message to confirm you are getting the same thing or if you would like to add or change your order. Suri adds that this can speed up the drive-thru process and make it a better experience.Labor is getting more expensive and technology is getting less expensive, Suri says. He adds, automation is the strongest it’s ever been today but it’s going to look like nothing compared to five to ten years from now. To hear more from Suri about innovation, the future of technology in foodservice, and virtual staff members, check out this episode of The Restaurant Report on Spotify.

Leading off with the Cooper’s Hawk announcement of their IPO in 2022 will set the stage for a few restaurant operations to take a lead in bringing themselves to the public stage. According to Ernst & Young, 2021 featured the highest annual deal volume on the markets ever, with 2,388 companies going public. The big questions for Coopers will be the connection to the Millenial and GenZ as a real market starts to emerge and could affect their powerhouse wine club of 500k strong. Casual dining still continues to be the one sector that has been affected most which could cause concern for Cooper's Hawk's valuation as an on-premise-focused casual dining brand.My 2022 Trends to Watch:I dive deep into mostly a technology-facing aspect of where the industry needs to go. I think we have finally faced our demons as an industry and understand that this is no longer an option for our success, but instead, the industry could be embracing a new technology avalanche coming its way. Tune in to the podcast for the full list of my trends to watch.

As we dive into this week's podcast we begin to tread in areas not often mentioned by the restaurant industry with Drone delivery leading the way and how Flytrex may be the next Uber for restaurant delivery. The real question will be the adoption curve of the digital consumer and if they have the uptake acceleration we have seen with online the third party. The likelihood that we see widespread drone delivery by 2025 is now a real possibility.C-Stores may have been the old school grab and go's of the past, but soon they will be forced and poised to enter the serious fray of fast-casual as they face an entirely new population of electric cars that are about to change the landscape of the American roadways. Fuel stations could be a thing of the past by 2030 and see the birth of a new model for C-store applications.Chipotle is often referred to as the rule breaker and the one that seems to always be out in front. In my book the Chipotle Effect, I predicted what we would see a new reality of the digital restaurant which is now becoming evident. Chipotle continues to separate from the pack as they enter into a fully digital and Chipotlane model - that in my opinion puts them on a course to 10K location by 2030. Lots to unpack in this episode as we also discuss what the tech stack might look like as we see these three key shifts moving the food consumer further and further from the dine-in restaurant.This episode is sponsored by Popmenu. Get $100 off your first month with Popmenu. Popmenu.com/restaurantreport

Food safety is a huge aspect of how Ghost Kitchen will control most of the digital landscape for the future and understanding the demand on a restaurant brand will be huge for both consumer awareness and brand impact. Maybe this is why we are seeing David Change make a quick exit from Reef Kitchens with reported food safety concerns.The issue stems from reports from Business Insider and Restaurant Dive that Reef's units served undercooked food and routinely failed safety inspections. Fuku has moved to Kitchen United according to a press release.Metaverse for restaurantsThis may be the new wild west for restaurants and how this integrates into brand building, digital payment, order placement, gamification and so much more. My deep-level reporting on my show Tech Path explores the Metaverse and the blockchain and how Web 3 could shift the sands of digital to a completely new understanding of how digital restaurants will be realized in the future. Applebees and McDonalds have tested the waters with the recent sale of NFT's and the entrance into a new creator-related Metaverse play. The biggest point to notice here is the massive lack of awareness to what is happening in this area for technology as related to the restaurant industry - though not a surprise when I look back on how restaurants were highly unprepared for social media in 2007, the early adopters will be the winners once again.Looking for Metaverse and Blockchain strategies for your restaurant?

DoorDash on Monday began offering 10- to-15-minute deliveries in the New York City neighborhood of Chelsea and if this works out they plan to put the hammer down to compete with some of the services like GoPuff and other younger upstarts that are starting to put some pressure on the top dog in delivery.Jack in the Box has entered into a definitive agreement to purchase Del Taco for $575 million, or $12.51 per share in cash, the companies announced Monday. This I think was a perfect acquisition for JIB with similar but not identical markets. The biggest issue we see is the potential to grow a demographic - Our Foodable Labs data revealed that Del Taco has a crossover rate of 23.8% of Jack in the Box customers one of the lower crossover demos in fast food!McDonald's is pulling a celeb play with Mariah Carey with 12 days of deals, plus fans have even more reasons to celebrate the Mariah Menu with free, limited-edition merch and a holiday-themed TV commercial.NFT's for restaurants may be closer than you think! - Make sure to listen to the full podcast to get the inside on how Blockchain and NFT's may be the next gold rush in restaurant technology - similar to the era of social media adoption by restaurants in 2007!

Mod Pizza is set to go IPO soon and is one of the darlings of the Fast Casual Segment, founded in 2008. They have been on a tremendous growth plan. They have raised $160 million and set a goal to increase its store count to 1,000 locations by 2024. Check out our Brand Analysis on Mod Pizza on a recent podcast to talk about their unique culture, which sets them apart from any brand I know.Will the Robots be able to earn the acceptance of consumers as we see mass adoption coming for restaurants in the next few years? According to the Bureau of Labor Statistics, August saw record amounts of workers quitting, with over 4.3 million Americans leaving their jobs. 867,000 of those were accommodation and food service workers.73.8% of consumers are willing to interact with RobotsBiggest Concern - 87.4% Safety and SanitationVelvet Taco Sells Out! And while they are finding the new home with Leonard Green & Partners, Front Burner, the seller will maintain a minority stake. The issue is that I think they may have sold this too cheap - waiting for the information, but I speculate the valuation was under what this concept should be worth.Also, listen in on our updated Self Service data from Foodable Labs!78.4% of customers will engage self-service over waiting in a line81% of consumers will switch brands when a SS operation is clunky Best and Worst Self Service BrandsTijuana Flats 43.3 ScoreChipotle - 85.6 Score

As we continue to see a shift in technology to take on the rising issues with Labor C3 and Sam Nazarian is leading a seed capital round of $ 20 million for Nomi, a startup that uses automation to create bowl-based meals. The investment is part of a 50/50 deal with a partnership with C3, which will test the robotic kitchens through "Iron Chef" Masaharu Morimoto's Sa'Moto restaurant concept. The space is scattered with tech startups like Piestro, Beastro, Refraction Bot delivery,RBI's leadership may be up to something with this acquisition of Firehouse Subs for a coll 1.1. billion. Though I expect this is a play for growth as RBI continues to see a struggling performance in comparison with other QSR concepts. McDonald's is looking to deliver a gangster move on third-party delivery with a white-label deal that could have ripple effects on an entire industry with 32K restaurants and a need for high-speed delivery to ensure quality. Door Dash and Uber may have just bagged the 800-pound gorilla without a safety cage.Last up is Sweet Green and whether or not the 364 Million IPO will make a big difference for this brand who has struggled to get profitable for over five years. Likely that the recently hired Chris Carr as COO will have his hands full with a huge demand for performance from the public investors.Foodable Labs Sentiment RankingsSweetgreen - 75.48 - Ranked #23Firehouse Subs - 71.02 Ranked #57Burger King - 73.02 Ranked #42Tim Hortons - 56.99 Ranked #203Popeye's - 62.37 Ranked #112