$700 million (!) for Wonder

Author

Andy Moore
March 22, 2024

Happy Friday! 

Did you miss picking Oakland over Kentucky yesterday? One expert got it right: Jack, the (actual) buffalo that Buffalo Wild Wings tapped this year to make March Madness picks:

Other than nailing the Oakland upset, Jack’s bracket is looking a little worse for wear. He had McNeese State winning it all.

3 Numbers

1,370,044

Number of loyalty points held by McDonalds’ top holder in the US, according to McD’s senior marketing director Guillaume Huin. That’s enough to buy 913 vanilla cones (worth around $3,600). Huin said that the unknown champion is the top holder by a whopping margin of 400,000 points, so “please, feel free to use some.”

202

Store commitments signed by Potbelly in the first three months of 2024. The company —which peaked at 495 stores in early 2018 — has seen net unit declines in each of the past 6 years, but is now experiencing a bit of a turnaround, with double-digit same-store-sales growth in 2023 and early success in its refranchising strategy.

$500,000

Cost of a meal (plus travel expenses) on Spaceship Neptune, a space balloon set to make its maiden voyage next year. Danish fine-dining chef Rasmus Munk is designing an in-flight meal that’s heavy on, uh, “aerogel-inspired food and encapsulated aroma.” Diners will enjoy the grub after ascending to the suborbital height of 100,000 feet above sea level.

What’s In the News

Wonder — the delivery-focused food hall concept — announced a staggering $700 million raise. From the WSJ:

Wonder last week raised $700 million from investors under a structure that promises equity at a potential discount once particular milestones are met, such as a sale or initial public offering, said Chief Executive Marc Lore. The startup, which also owns meal-kit provider Blue Apron, has raised $1.5 billion overall.

In 2022, when Wonder last raised significant funding, The Wall Street Journal reported it was valued at $3.5 billion. Investors in the recent round, including New Enterprise Associates, GV and Dragoneer Investment Group, provided capital through a simple agreement for future equity, known as a SAFE note, said Lore.

Wonder has had a busy year — in 2023, the company scrapped its initial plan of launching a nationwide fleet of food trucks (where cooks prepared meals curbside at customers’ homes) and pivoted to a model in which multi-concept food halls serve chef-inspired meals for pickup and delivery.

Wonder has opened 11 of these locations in New York, and now plans on using its sizable war chest to blanket the New York area with over 100 units.

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Nothing much to see here, just a humanoid robot serving a guy a snack and doing the dishes:

There’s a lot to unpack here: The human-like stammer in the bot’s speech (robots… they also get nervous on camera!). The robot identifying food and trash and serving the person the apple while tossing out the trash. But, above all, the fact that the robot was not coded to do any of the actions in this video — instead, it was given ample video data, which prompted it to act accordingly when given verbal requests. Wild!

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A year after purchasing NextBite, Sam Nazarian is also acquiring Kitchen United’s IP and assets.

Kitchen United (and NextBite) will be merged with Nazarian’s food hall and virtual brand company, C3, to form a new platform, Everybody Eats. From Restaurant Dive:

Everybody Eats was formed in December and is a “a 100% asset light IP and premium QSR and CPG Brand company,” per the press release. Nazarian, who is CEO of Everybody Eats, appointed Geoff Madding, former chief growth officer of Nextbite, as chief operations officer for the new platform.

Nazarian’s purchase of Kitchen United parts marks the final chapter of the firm’s ghost kitchen operations. The company raised $100 million in 2022 to fund its expansion, but in November, it announced it would sell or close all physical units to focus on its software.

Despite some recent upheaval in the space, Nazarian sees untapped potential in virtual brands: “These companies have had incredible ideas and unbelievable instincts but just not enough capital to ultimately disrupt the market.”

Headlines

Starbucks passed Subway last year to become the second-largest chain in the world (by total location count). Chipotle announced a massive 50-for-1 stock split. Shake Smart — a healthy fast-casual concept — received an (undisclosed) investment from PE firm NewSpring Franchise. McDonald’s named CEO Chris Kempczinski its new board chairman. Virtual Dining Concepts acquired OG virtual brand Man Vs Fries. Delivery drone startups have recently received some significant federal approvals, but cost hurdles remain. GoTo Foods is opening the first Cinnabon-Carvel hybrid brand (called “Cinnabon Swirl”) this year. Subway is switching from Coke to Pepsi. Sonic is launching a solar-eclipse themed “Blackout Slush Float.” Chick-fil-A opened its first mobile pickup restaurant in New York. Shake Shack announced that it’s hired Papa Johns CEO Rob Lynch for its top post. Patrick Mahomes and Travis Kelce are opening a steakhouse.

Name That Chain!

You’ve got three guesses to name this week’s mystery chain:

  • This chain has its biggest presence in the UK - as of 2023, over 400 locations.

  • It originally was called “Chickenland.”

  • Celebrities like David Beckham and Ed Sheeran are rumored to be holders of “Black Cards,” which entitle them to free meals at any location. (Sidenote: Asking for a Black Card is the best way to ensure you don’t get a Black Card.)

Last week’s answer: Texas Roadhouse

#Content Recs

‘Member When?!

Are you ready to experience a serious sense memory?

The hanging planters, the hard booths, the iconic wallpaper — I can literally smell the bread right now.

Thanks for reading! We’ll be back next Friday with a recap of industry news.

Andy

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