Apr 25, 2019

Virtual Restaurants

By Miloš Čitaković

In the western world, the modern day restaurant was born in 18th century Paris. Initially, they were called “Bouillon” as they specialized in soups. Their existence was predicated on health, not gustatory, requirements as soups were seen as a health food. In China on the other hand, there are accounts that restaurants have been around since the 11th century and catered to different styles of cuisine, price brackets and religious requirements.

Nowadays, restaurateurs and chefs work furiously to improve their menu, innovate the dining experience and differentiate themselves in this ultra-competitive market. Guides are created just to navigate this landscape and awards given to the top chefs in the world. New cuisines are created every so often such as farm-to-table and molecular to help reinvigorate the dining experience. Yet an industry that had $710 billion in sales across the US in 2014 still did not manage to innovate the fundamental concept of a brick-and-mortar restaurant — up until now.

Food delivery services have been around for a while and the better known ones such as GrubHub, Seamless and Caviar process around 200,000 orders on a daily basis in the US. Yet all of these delivery services simply pick up meals from brick-and-mortar restaurants and deliver them to you.

Now, startups such as Sprig, Munchery and Spoonrocket argue that in this digital on-demand age, there is no reason restaurants should have a storefront. These startups allow customers to see daily changing menus on their smartphones, and order with ease. Venture capitalists have warmed to the concept: Sprig, Spoonrocket and Munchery have raised $IOO million in funding among them. Whether there’s an appetite for elite conveniences like these outside Silicon Valley remains to be seen.

But one thing is for sure, the industry is growing — rapidly. As of today the east coast has also been given a taste of virtual restaurants with entrants such as Maple, Kettlebell Kitchen and Munchery in New York. And as customers warm up to this new concept, the industry only stands to grow.

The virtual restaurant is arguably the first time that the restaurant industry has fundamentally changed the way it caters to customers on a large scale. And the underlying business model is changing as well going from a high rent to a high logistics cost model. If that can be profitable remains to be seen as none of the start ups disclose whether they are profitable.

Looking forward with the virtual restaurant, the possibilities are vast. We finally start to see interactive menus such as in Munchery which gives you the nutritional content of each meal. Guest star chefs prepare each weeks menu. And you are able to review dishes by having customers comment and rate inside the app. No more Yelp like reviews which are seemingly more focused on berating the restaurant staff than commenting on the actual food.

The virtual restaurant will inadvertently grow a whole new industry. Kitchensurfing is a great example — it allows you to order a chef to your home and prepare home-cooked meals for you and your friends. DishOh is a mobile review app which allows users to comment just on dishes. Finally, Square Order lets you order from nearby eateries, pay for it, and then get a ping when it is ready for collection.

Whether or not the virtual restaurant is here to stay in its current form, or is just part of a tech driven fad remains to be seen, but one thing is for sure — the restaurant industry has finally integrated mobile tech — and both are here to stay.

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