'There's Not a Bigger Problem Right Now': Wavemaker Labs' Buck Jordan on How Robotics Will Change Restaurants
On this week's episode of L.A. Venture, hear lots of insights on equity crowdfunding from Buck Jordan. He's raising $50-$100K a day, mostly on SeedInvest, for the robotics and food companies coming out of WaveMaker Labs.
Jordan also addresses the dramatic changes coming to the food industry, and why WaveMaker is so focused on the application of robotics to this industry in particular.
"The best investments I think come from the really hard problems," he says. "There's not a bigger problem right now or an industry that's more under siege than the food industry is."
Even before COVID struck, he said, the food industry was a very difficult business.
"Restaurants fail faster and more often than startups," he says. "This is an industry that's under massive strain from all areas. There's rising labor costs. There's rising food costs. Real estate costs is going crazy [...] And most of those problems I mentioned are really well served by automation."
Robotics is uniquely poised to solve these problems, he says, because of recent advances in technology, as well as a massive drop in costs. Robotic arms that cost around $100K in 2015 are now selling for $1,000, he says.
" All of a sudden, really only in the past couple of years, the entire problem of automating low-cost labor is relegated to more of a software problem and less of an expensive hardware problem."
Jordan also shares his ideas about equity crowdfunding, corporate innovation and how seed stage companies can take advantage of corporate partners.
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At the new zero-waste restaurant La Papille Gustative, customers don't even have to see a server to order $18 avocado toast or $15 buckwheat quinoa waffles.
They can order straight from their mobile phone while dining outside.
"We are not a full service restaurant; we don't have a server coming to you taking your orders, but this is your server. This is your waiter," said owner, Marina Aljanedi.
Aljanedi, like tens of thousands of restaurateurs, has had to adjust to the new pandemic normal. The California Restaurant Association estimates two-thirds of workers in the industry have been either laid off or furloughed since March as some of the biggest names in the Los Angeles-scene, such as Bazaar and Bäco Mercat, permanently closed.
Those that have survived have adopted new contactless menus, delivery services and other tech-powered solutions to keep their employees safe and diners fed.
Aljanedi, who had to scramble to provide outdoor dining, added Santa Monica-based Order For Me's service to let customers order ahead or at their table.
The service relies on QR codes — once said to be a thing of the past. But these codes help power services by companies including Paytronix, Presto and Zuppler that restaurants are increasingly relying on to keep their profits up and customers at a distance. The ordering system lets in-house diners buy food on their phone, a function that companies like Grubhub, Chownow and Postmates haven't focused on.
Order For Me's platform lets customers order, pay and tip from their phones. Its most distinguishing feature is that it allows diners at the same table to split bills and keep a running tab.
Although the company only operates in 35 restaurants in Los Angeles, it's working with several hotels to expand their services. And it has seen a spike in demand as California restaurants prepare to reopen in the coming weeks under Gov. Gavin Newsom's new order that allows for a 25% capacity at qualified dine-in restaurants.
But competition is stiff as the restaurant business is increasingly turning to tech.
Founded two years ago by Michael Jordan and chef Greg Daniels, Order For Me sought to develop a contactless ordering service.
At the time, Jordan thought the platform would benefit from California's minimum wage increase as restaurants sought to offset the cost of labor, but he never expected a pandemic to increase the need for the product.
Order for Me co-founders Greg Daniels (L) and Michael Jordan (R).
"I started in 2018. I knew this was going to be a very steep climb; we were thinking like 10 years to do this and disrupt the industry," said Jordan. "But we committed to it because we knew that it was going to happen, and it was going to be us. We were in a few restaurants before COVID and then COVID hit and we changed up our product a little bit."
He added an order-ahead feature to the service.
To draw in new customers, Order For Me is offered free for life to restaurants that sign on until the end of 2020 and to keep a 5% service fee that guests pay when using the platform. The company makes money by charging users a small service fee for the transaction.
Jordan said the pandemic likely changed restaurateurs attitudes about the need for technology as part of their business.
"The attitude was (once), 'Well, I can't wait to get this over with, and for it to get back to normal'," he said. But after restaurants had to shut down for a second time, there was a gradual acceptance. "Normal is going to be different," said Jordan. "Definitely the customer's mindset is changed, probably permanently."
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Have you always dreamed of scarfing down a Dodger Dog while sitting in your pajamas on your couch? You're in luck. The Los Angeles Dodgers have teamed with Postmates and Home Team Kitchens to deliver stadium grub to your doorstep.
There are certain rules in life. You consume a giant tub of popcorn and a large soda when you go to the movies, a bowl of chili when you're skiing, and a hot dog and all manner of other sodium rich foods in order to distract you from the dullness of a four-hour baseball game. But this is 2020, where any normal rules have long since gone out of the window and people are craving for any way to have a taste of pre-pandemic days – as long as it can be done from the safety of their home.
Using Postmates or its competitors, one is free to choose from a vast selection of food - sushi from Sugarfish, chicken burgers from Howlin' Ray's, tacos from Guisados. So I was curious to know why anyone would want to order items they normally get only because they are confined to the stadium with nowhere else to go.
"It's comfort food and the kind of thing we need these days," said Mike Jacobs, founder and CEO of Home Team Kitchens.
Interestingly, the Dodgers starting working on a plan to deliver food in February, before the coronavirus starting causing havoc in the U.S.
"The coronavirus accelerated what we thought was a cool brand extension for us," said Tucker Kain, president of Dodgers Business Enterprise, who sees delivery as a good way to keep front of mind for fans. "We want to build a bridge with fans in a meaningful way given that the live experience isn't available."
The Dodgers and Home Team Kitchens think people will want stadium food even when they are not watching a game. "It's great food to have if you're watching Netflix or if you're at work and you want a big serving of nachos," Jacobs said.
The program quietly soft-launched on opening day and started marketing this week when the Dodgers travelled to Houston. Food is prepared out of a single ghost kitchen in Hollywood, but there are plans to expand it to 25 locations throughout Los Angeles so deliveries can be faster and fresher. Jacobs also wants to partner with sports bars to open several dine-in options.
"Demand has been greater than my projections," said Jacobs. "It's double what I was expecting. We're hiring new staff and expediting getting more locations. It's a lot of Dodger Dogs." (Dodger Dogs have also been available in select ampm locations since 2016.)
What It's Like Ordering a Dodger Dog at Home
Yesterday, as the Dodgers were preparing for their final game against the dreaded Astros, I opened up Postmates and ordered $30 of food (which came to $50 after taxes, fees, and tip.) Here's how it went.
No standing in line or worrying about missing an at-bat. First pitch was scheduled for a little after 4 p.m. I placed my order at 3:16 p.m. Postmates said my food would arrive no later than 4:20 p.m. to my apartment in downtown L.A. That turned out to be slightly optimistic, as I didn't get a text until 4:24pm notifying me that my order had arrived.
Jacobs sighed when I told him how long it took for me to get my order.
"We're hoping for 30 minutes, but it takes some time to get that right," he said, adding that with more locations the wait times will come down and the food should be hotter.
Super Dodger Dog
They don't call it a cold dog and unfortunately the dog was not even lukewarm. Maybe I should have stuck it in the microwave? I missed the warm foil wrapped version from the ballpark but once I doused it in the ketchup and onions provided, it wasn't bad.
Carne Asada Helmet Nachos
At $15.95, this was my splurge of the night, but I could not resist eating out of a batting helmet and the portion size could probably feed a whole family. The tortilla chips were soft but fortunately not soggy, covered in cheese and generous chunks of asada. But again, the dish was cold so instead of getting the hot cheese you get at the stadium, it had coagulated into globs.
Brooklyn Dodgers Blue Gelato
I was excited to order this because it was advertised as coming in a mini Brooklyn Dodgers helmet but instead mine came in a much less exciting white plastic cup. At least this was the correct temperature though. Proving it's easier to keep cold things cold than hot things hot, the gelato was surprisingly cool and creamy. I took a few small bites and then stuck it in the freezer — one thing you can't do at the ballpark.
Couldn't tell you. I don't get Spectrum SportsNet so I was planning to watch on ESPN, but the game was blacked out there. (I later read the Dodgers won 4-2 in a 13 inning thriller.)
Eating a cold Dodger Dog at home is an experience everyone should try at least once, but probably no more than that. Delivering warmer food would definitely help, but we are lucky enough to have a lot of great restaurants to choose from in L.A., so the next time I spend $50 on stadium food will be at the stadium.
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