In today’s connected economy, the ways we get our food needs met are running together, with restaurants offering packaged foods, grocery stores selling prepared foods and hybrid solutions such as meal kits coming to the fore. No wonder then that the distinctions between the home cook and the commercial chef are also blurring.
Last week, WoodSpoon, a delivery service that allows consumers to order meals prepared by local home cooks to be dropped off at their door, announced a $14 million Series A fundraise, led by quick-service restaurant (QSR) giant Restaurant Brands International (RBI). Since PYMNTS last spoke to WoodSpoon CEO and Co-founder Oren Saar at the start of the year, the company’s growth has accelerated dramatically, as across food industries it has become clear that the rise in delivery ordering is more than just a quarantine trend.
“[After] January 2021 … we were growing much faster than we expected,” he told PYMNTS in a recent conversation. “We grew about 50 percent month over month in every aspect — in customers, in home chefs, in revenue — and we started seeing really good traction in all of those aspect … So we raised this A round about eight to 10 months earlier than what we initially thought.”
The demand makes sense, given the stickiness of consumers’ on-demand expectations for both grocery and restaurant foods. PYMNTS’ study, The Bring-It-To-Me Economy: How Online Marketplaces And Aggregators Drive Omnichannel Commerce, created in collaboration with Carat by Fiserv, finds that 48 percent of consumers now order foods from restaurants’ websites for delivery more often than they did before the pandemic. Additionally, 27 percent order groceries for delivery more than they did before March 2020.
When Do We Want It? Now
WoodSpoon gives consumers the option to either order their meal in advance or order it on demand, and Saar notes that around 7 out of 10 purchases are on-demand orders.
“I guess my generation is less patient,” said Saar, a millennial. “And also, I don’t want to plan ahead … I don’t know where I’m going to be tonight, so I definitely don’t know where I’m going to be next Thursday. So this is why the on-demand aspect of this is crucial.”
The company currently operates in New York City boroughs Manhattan, Brooklyn and Queens, and Saar views its competitors as all the other businesses in those areas that offer food wherever and whenever consumers want it, though he believes that the personal connection that customers develop with the platform’s home chefs sets WoodSpoon apart.
“People are craving personal connection,” he said. “They want to know who is cooking for them … and when a personal connection starts to form, this where it starts to get interesting on the WoodSpoon platform.”
He added that, through the platform’s messaging tools, customers and chefs have the opportunity to develop personal connections. A chef may get to know a given customer’s unique dietary needs, or they may throw in an extra item for a loyal customer for free.
Bigger And Better
To get a better sense of where there is demand for its service, WoodSpoon is looking at its nationwide shipping program, which allows chefs on the platform to send any homemade foods that can be shipped through UPS to consumers anywhere in the country.
“We started seeing very interesting things, like people from LA ordering challah bread from New York and people from Chicago selling cookies to people in Utah,” Saar said. “We’re going to use these data to see traction, see where customers are coming from, see where we have a good pile of home chefs that we can leverage, and we’re going to go from there.”
The company is currently solidifying its base logistically and operationally, troubleshooting and building out its team. By the end of the year, Saar said, the company hopes to have established a presence in eight to 10 new markets.
With A Little Help From Their Friends
Going forward, in addition to expanding geographically, Saar also wants to build out the services that WoodSpoon provides for its home chefs, improving the economics and the workflow of the model. For example, one of company’s goals going forward is to provide chefs on the platform with their ingredients, optimizing food spend across the business.
“Once we enough home chefs, and we know exactly what they cook, when they cook, and which [ingredients] they need, I can provide it to them and reduce their costs in significant amount,” said Saar. “This is just one aspect where we can help them, but we are thinking about a lot of different ones.”
To help make such initiatives a reality, the company will tap RBI’s expertise in running a major national food business. In WoodSpoon’s initial conversations with RBI, the QSR company shared that it could help the company achieve these goals, Saar said, noting the company has “a lot of systems that they can introduce to us.”
Saar added that WoodSpoon would look to RBI not only for its knowledge of the food supply chain but also of marketing and delivery.
“RBI believes strategically that the space we’re going to is the space of the future, and they want to put themselves out there for success,” Saar said. “They believe that what we’re doing right now is where most consumer are going to consume food in the future, so they want to be there.”
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More