Virtual Kitchen Nets $20M To Assist Restaurants With Delivery

Virtual Kitchen, a startup founded by ex-Uber employees, has raised $20 million in fresh capital in a bid to capitalize on the need for food delivery amid the pandemic, according to CNBC.

Virtual Kitchen works to provide technology for others to set up commercial kitchens for food delivery. The company helps restaurants to deliver food to expecting customers without the costlier parts of operating a dining room or whole store at the same time, which has become necessary amid the pandemic.

The round was led by Keith Rabois, a partner at Peter Thiel’s Founders Fund. Last year, the company was also the recipient of a $15.3 million round led by Andreessen Horowitz and Base10 Partners, CNBC reported.

The company was founded in 2018 by Ken Chong and Matt Sawchuk, both of whom used to work for Uber. They’re now in the position of competing with another Uber alum, their former boss Travis Kalanick, who now runs Cloud Kitchens, which reportedly raised $400 million from Saudi Arabia’s Public Investment Fund last year, according to CNBC.

All of this signals the immense popularity of the cloud-based kitchen concept, which data from market research firm Reports and Data said will grow as a global market from $650 million in 2018 to $2.6 billion by 2026, CNBC reported.

Customers using Virtual Kitchen aren’t blocked from also using Uber Eats, DoorDash or other such companies.

A PYMNTS report from February noted the staying power of the form will likely be connected with customers’ wallets. Charlie Yi, CEO of sushi restaurant and ghost kitchen Zoku Sushi told PYMNTS that the winners in the field will be those that can offer quality meals at compelling prices.

“The billion-dollar question [is] how do you seize … the opportunities and advantages of ghost kitchens? … When you start as a digital native — when you didn’t build your brand in the traditional way as a restaurant — how do you cope with that?” Yi said.