Dark kitchens
Where money goes when restaurants close
Last updated: 30 Jun 2021
Market 101
Scrap the tables, chairs and expensive rent for prime real estate, and you've got the basic idea behind dark kitchens: restaurants that focus on delivery only instead of dining in. A new breed of startups are convinced this is the secret recipe to slashing costs and upping profits in the restaurant game. Whether by offering shared kitchen workplace or developing virtual restaurant brands, they’re all aiming to gain new efficiencies from online food delivery. Optional extra: using the savings to cut the price for consumers so they order more often.
The Covid-19 special: the pandemic is skewing market dynamics. Restaurants, hotels, pubs and catering halls were closed for months and are still not back to operating at full capacity. Their loss is dark kitchen startups' gain. Many are now focusing on how to license virtual restaurant concepts to underutilised kitchens, and bring previously untapped restaurant owners in on the food delivery goldmine — with a nice tip along the way.
Early stage market map
Key facts
€24.3bn
Value of Europe’s food delivery market1
Trends to watch
1. Real estate wars
→ Startups are on the lookout for large industrial spaces like car parks or railway arches from which they can easily deliver their food. It's cheaper than restaurant space, but still capital intensive.
→ To up the challenge, there are only so many properties that fit the bill. A competition around cheap and conveniently-located real estate may emerge.
Startups tracked by Sifted
Sifted take
By licensing their brands to restaurants with underutilised capacity, dark kitchen startups like Kbox and Taster are removing previous barriers to scalability. In the future, competition may revolve less around dark kitchen real estate, and more around building up a network of restaurant partners.
Rising stars
Kbox licenses its virtual restaurant brands to underutilised commercial kitchens alongside technology for training and greater operational efficiency. In this way, it addresses the scaling issues that are prevalent among capital-intensive dark kitchens. Founder Salima Vellani is a serial entrepreneur and former private equity professional in the food and beverage industry.
Round
Series A
Date
2020
Size
€14m
Early stage startups to watch
Curb
Virtual restaurant brand (operates own dark kitchen)
€23.3m
€20m
-
Devor (Dark Kitchen)
Virtual restaurant brand (operates own dark kitchen)
-
€1m
-
Eat Clever
Virtual restaurant brand (operates own dark kitchen)
-
-
-
Epic Foods
Virtual restaurant brand (operates own dark kitchen)
€1.5m
€1m
-
Feastr
Virtual restaurant brand (operates own dark kitchen)
-
€327k
-
Foodcheri
Virtual restaurant brand (operates own dark kitchen)
€7m
-
-
Foodomnia
Virtual restaurant brand (operates own dark kitchen)
-
-
-
Foodstars
Kitchen space rental
-
-
-
Honest Food
Virtual restaurant brand (licensing only)
-
-
-
Kbox
Virtual restaurant brand (licensing only)
€21m
€15.1m
-
Kitch
Kitchen space rental
€4.3m
€3.3m
-
Kitchen republic
Kitchen space rental
-
-
-
The LKN
Virtual restaurant brand (licensing only)
-
-
-
Europe’s success stories
Who early stage startups are up against
(Pre-)Seed
Series A
Series B
Series C
Series D+
IPO/Exit
→ Runs 250 dark kitchens (‘Editions’) in eight countries
→ Doesn’t charge its tenant rent, but reportedly takes up to 40% of their turnover
Sources
Research reports
Food Tech Invest Report 2021 | March 2021 | Hungry Ventures
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