They may well be the latest in digital marketing intangibles: a brand that doesnt exist anywhere but in cyberspace, slinging food out of a commissary kitchen to save costs on real estate, kitchen help and advertising while meeting the growing demand for takeout food. JL
Emilie Friedlander reports in Motherboard:
In 2020, the pandemic forced 110,000 U.S. eating and drinking establishments to shutter. Even before the coronavirus there were forces at play with the viability of the brick-and-mortar model: rising commercial real estate costs; a growing global delivery market; delivery apps that collect 30% of every sale, requiring restaurants to process a larger number of orders to make money. Ghost kitchen companies are responding to macro-shifts in the industry that make operating a delivery-optimized business out of a shared kitchen a more cost-effective proposition.Logging on to a delivery site when you’re too tired to cook is an indulgence that can be hard to avoid, especially during a pandemic. But what happens when a restaurant pops up in your feed that seems too strange to actually be real? That exact scenario happened to me a few days before Christmas, when I opened DoorDash and discovered a new restaurant in Durham, North Carolina that was running a “20 percent off” promotion. The restaurant was called “F*cking Good Pizza.”Clicking on the listing, I discovered a series of brightly lit, oddly clinical images of ruddy-looking pies with sausage crumbles and slick orange buffalo wings. The menu was divided up by categories like “F*cking Good Pizzas” and “F*cking Good Sides” and “F*cking Good Drinks,” as though the quality of these offerings was somehow supposed to speak for itself.
I couldn’t believe that somebody had named their restaurant “F*cking Good Pizza,” so I texted a friend who worked for the local paper and asked if she thought it was actually a thing, adding that the DoorDash listing listed a location on 9th street.
“Oh god I hope not,” she replied. She said she didn’t know of a business at that address, a region of the city adjacent to Duke University—and speculated that it might be some kind of chain.
I Googled the address and got a hit: Devil’s Pizzeria, a New York-style pizza shop that also sells tasty, epically sized portions of pasta and wings—the kind you might pick up at an actual NYC slice shop when you want to curl up with a movie and eat your feelings.
At first, I didn’t think very much of it. But then, as I continued scrolling DoorDash, I discovered a couple of other newly added restaurants I had never heard of before. All of them had similarly attention-grabbing names, along with vaguely uncanny photos that seemed to suggest something a bit trendy and upscale.
One of them, which also traced back to Devil’s address, was called Pimp My Pasta, a kind of build-your-own pasta dish concept featuring plates of plain cooked pasta next to vividly colored add-ins like sun-dried tomatoes and peas. Another, also listed among the new promotions, was called OMG BBQ LOL. It shared the same address as a barbecue restaurant, but something about the zillennial-friendly name and product images—cuts of smoked brisket and caramelized ribs, fanned out on charmingly old-fashioned butcher paper—suggested that it was part of the same scheme. Despite the on-the-nose branding, for example, I noticed that some of the graphic logos on these listings looked weirdly pixelated, as though whoever set up these pages had unwittingly uploaded a photo that was too small.
It occurred to me that these local eateries might simply be trying to supplement their income by experimenting with virtual brands, the fast-growing pandemic-era trend of delivery-only restaurant concepts that even large chains like Chili’s and Chucky Cheese—and celebrities like Tyga, Mariah Carey, and YouTube influencer Jimmy “MrBeast” Donaldson—have been tapping into while everyone is stuck at home. In a global food delivery market that is expected to be worth as much as $365 billion by 2030, reports of restaurants preparing and selling food for multiple brands simultaneously—often through franchising partnerships with companies like Virtual Dining Concepts and NextBite—are not uncommon, especially at a time when restaurants are feeling the pinch.
But there was something about this particular cluster of restaurant brands that was harder to pin down. For one, they didn’t actually seem to be brands—at least in the usual sense. None of them seemed to have a website (though I eventually discovered at least one of them that did), and I couldn’t find any person or organization that seemed responsible for creating them, or any mentions in the press.
This would make sense if these were one-off concepts that these neighborhood restaurants had come up with themselves; Uber Eats, for example, claims to have helped some 4,000 restaurants in North America eke out additional income by creating their own custom virtual brands over the past four years, according to The New Yorker. But when I tried googling “Pimp My Pasta,” I noticed something strange: There was a Pimp My Pasta in Las Vegas, a Pimp My Pasta in Alexandria, VA, and several in both New York and Los Angeles. Cross-indexing the name with different delivery sites on Google, I counted 42 of them in total—some as far as Australia, Kuala Lumpur, and the United Arab Emirates.
Suddenly, I was seized by a need to get to the bottom of a matter that felt like a glitch in the fabric of my humdrum pandemic existence: Where did these clickbait restaurant brands come from, even if they didn’t seem to technically exist? And why did delivery marketplaces across the U.S., and countries around the world, suddenly seem to be flooded with them?
Acouple weeks later, I decided to track down as many brands as possible that appeared to be part of this scheme, hoping that at least one of them might lead me to the source. This was time-consuming work, but not difficult: I quickly discovered that nearly every restaurant I was able to connect with a F*cking Good Pizza or an OMG BBQ LOL was selling food under additional aliases, too.
When I stumbled on F*cking Good Pizza before Christmas, I traced four other DoorDash listings back to Devil’s address that appeared to be part of the cluster: Cupid’s Wings, Cheeky’s Cheesesteaks, Groovy Island Pizza, and Pimp My Pasta. I later discovered four more associated with that location, including Brooklyn Calzones—which features such hyper-specific offerings as “The L Train Calzone,” “The Prospect Park Calzone,” and “Bushwick”—and Mothership Pizza, a smirkingly stoner-friendly concept with items like “Moon Cheese Pizza” and “Black Hole Chicken Bacon Ranch.”
Googling these brands led me to dozens of other restaurants that were using them; I counted 45 different locations selling F*cking Good Pizza, for instance, and 65 selling Cupid’s Wings. Googling the addresses of these eateries uncovered additional brands in turn. While searching “F*cking Good Pizza,” for example, I stumbled upon a post by a confused Reddit user who had found 10 restaurants operating out of the same pizza place in Nashville; it was using many of the same brand names that Devil’s was, but also ones like “The Hot Italian” and “The United Pepperonis of Pizza.” Another F*cking Good Pizza location was a Kosher dairy cafe in Sheepshead Bay; it appeared to be selling food under at least a dozen cheeky aliases, including “Pimp My Pasta” and “Dirty Little Vegan.”
While operating several of these brands simultaneously seemed less the exception than the rule, there was one address that my Google marathon kept leading me back to: 1842 W. Washington Blvd., a nondescript-looking brick building in South LA that I quickly realized had to be some sort of ghost kitchen, or delivery-focused cooking facility uniting multiple food businesses under one roof; I counted about 40 restaurant listings associated with the address —many of which seemed to belong to the group of brands I was researching—before giving up.
Googling 1842 W. Washington Blvd. revealed that it was a ghost kitchen—and a fairly high-profile one at that. The building is listed on LinkedIn as the primary location of a company called CloudKitchens, the secretive, technology-driven ghost kitchen start-up helmed by Uber co-founder and former CEO Travis Kalanick. CloudKitchens advertises itself as a lower-cost alternative to operating a brick-and-mortar restaurant. In a model that has garnered comparisons to a WeWork for restaurants, food entrepreneurs rent space in a shared kitchen facility and fulfill orders for delivery-only, forgoing costs on front-of-house staff and enjoying lower upfront expenses. It’s one of a number of ventures in the U.S. and abroad connected to its parent company, City Storage Systems, a firm that specializes in buying up distressed real estate assets and repurposing them for the food and retail sectors.
In 2018, months after his forced resignation from Uber, Kalanick poured $150 million into what is now called City Storage Systems, which counts tech entrepreneur Diego Berdakin, an early Uber investor, and Sky Dayton, the founder of EarthLink, among its founders. In doing so, Kalanick was purchasing a controlling interest in a company that was poised to gain an early foothold in a global ghost kitchen market that may be worth as much as $1 trillion in 2030. (He also hired some former engineers from Uber, a company that had made inroads into the food delivery space under his leadership with Uber Eats). Buoyed by a $400 million investment from the Saudi Arabian sovereign wealth fund, City Storage Systems has since purchased more than 40 would-be ghost kitchen properties in cities across the U.S., according to an investigation by the Wall Street Journal—often through stand-alone limited liability companies.
As I read more about CloudKitchens—a company with a reputation for being tight-lipped with the media and that even forbids employees to list their employer on LinkedIn—my spidey sense started tingling: I had begun my internet research binge on the hunch that these brands were part of some low-rent marketing scheme that somebody, somewhere, was licensing to restaurants online. Was it possible that Travis Kalanick’s new company had created them? Sure enough, buried in another article by the Journal, I found the smoke signal I had been waiting for: CloudKitchens wasn’t just renting out shared kitchen spaces; they were quietly rolling out virtual franchises of their own. The 2019 article, by Rory Jones and Rolfe Winkler, names three of them: “Excuse My French Toast, Egg the F* out, and B*tch Don’t Grill My Cheese.”
“The bigger implication is that you just have no way to be accountable with how you spend now.”
Excuse My French Toast. I recognized that name from somewhere. Googling it led me to a pizza place in Panorama City, CA that I had identified as listing a number of the brands that Devil’s Pizzeria was using. Could it be that these concepts and Excuse My French Toast came from one and the same source?
Hoping I could get a restaurant to confirm my hunch, I called Devil’s and requested an interview with the owner. While I was waiting to hear back, I decided to see if City Storage Systems had purchased any property in the Raleigh-Durham area. I wasn’t able to find any buildings registered under that name, though I did find some board minutes, made public by the behavioral healthcare organization Alliance Health, memorializing a decision to sell a 17,000 square-foot building in Raleigh to a company called City Storage Systems, LLC for $1,850,000. (In public filings indexed on the Wake County website, the building’s current owner is listed, simply, as “3309 Durham LLC,” after the property’s address.)
Eventually, I stumbled upon a piece of information that seemed like it might actually unlock the solution to the mystery. In a September 2020 article for The Mark-Up, journalist Adrianne Jeffries had reported that in addition to running its ghost kitchen business, CloudKitchens’ had launched an entire operation dedicating to building out “menus and branding” for its own virtual restaurant concepts—“off-the-shelf” restaurants that food entrepreneurs could license “from their own kitchens.” The name of the company, which I discovered to be registered as its own LLC in Delaware, was Future Foods.
The first thing I noticed about Future Foods was that it didn’t seem to have much of an online presence. Its Instagram page had just three posts—all dated to July 15 of last year—with slogans like “We help restaurants increase sales.” On its Facebook page, two days later, it had posted a similar image four times in a row while updating its information: “Looking for restaurants that can handle 100 more orders this week.” But it hadn’t updated its feed since then, other than a profile picture update on November 19.
Because LLCs registered in Delaware are not required to list member names in public filings, the exact relationship between the company and CloudKitchens is unclear. There’s no mention of CloudKitchens on Future Foods’ bare-bones website, and my repeated emails to Future Foods went unanswered. I did find a January Q&A with a San Francisco restaurateur and CloudKitchens tenant named Santiago Rodriguez on the official CloudKitchens blog: “Santiago not only runs his own brand, Frjtz, out of a CloudKitchens facility, he also leverages our existing off-the-shelf brands through our Future Foods team to further expand and grow his business.” When I emailed the press contact listed on CloudKitchens’ website to request an interview, however, the message bounced back.
When I finally managed to get in touch with a spokesperson for City Storage Systems and CloudKitchens, the company declined to comment for this story. Glancing at the carousel of colorful images on Future Foods’ site, I recognized the smiling cartoon noodle bowl logo from Send Noods—a noodle concept with blatantly culturally insensitive menu captions at some locations—as well as a photo belonging to Cheeky’s Cheesesteaks: a giant hoagie against a vivid blue background, innards glistening in the light. It appeared that I had finally stumbled upon the source of these elusive internet-only restaurants. The site described the company as enabling restaurants to “skyrocket” delivery sales “without complicating things.” “We tailor our brands to you so you can use the ingredients and equipment you already use,” it explained, noting that Future Foods had created over 200 of these “mouthwatering” concepts.
A few hours later, I got a call back from Ziad Lobbad, the owner of Devil’s Pizzeria in Durham. He confirmed that the brands I had traced back to his restaurant were part of a collaboration with Future Foods, and walked me through how it worked. In a nutshell, Future Foods takes different kinds of offerings on a restaurant’s existing menu and markets them as separate restaurants; in a crowded delivery marketplace, there’s a better chance you’ll cut through the noise if you show up eight times instead of once.
Lobbad said that a sales rep from Future Foods had approached him in fall 2020, asking if he would be interested in checking out some of its virtual restaurant concepts. They sent him a selection of menus centered around the sorts of items that Devil’s was already making, and Lobbad went through them with his kitchen staff, ticking down the list to determine which items they’d be able to easily produce. Once he’d customized an initial collection of four menus and was ready to start cooking, Future Foods took care of the rest: setting up virtual storefronts for the brands on sites like DoorDash and Postmates and marketing them online—often through promotions on delivery platforms, like the one that led me to F*cking Good Pizza.
Restaurants are paid out weekly, after Future Foods takes a cut of the proceeds. Owners I spoke with in different cities typically cited a fee of around 10 percent, on top of whatever percentage delivery services charge locally, with some saying that Future Foods designed its menu prices to account for these fees. This is not far off, and in some cases less steep, than the fee structures offered by other virtual restaurant brand companies (Nextbite, for example, takes an all-in cut of 45 percent, according to the New York Times), although one owner told me that Future Foods had simply offered them a fixed amount of revenue for every item sold. During onboarding, restaurant partners are also furnished with a tablet and printer and set up with an order management system called Otter, designed to consolidate incoming orders from different delivery platforms in one place.
Lobbad said that while he was a bit unsure about the whole thing at first, it was the latter service that convinced him to give Future Foods a try; he’d been looking for ways to streamline operations and reduce data entry errors in his kitchen, which he says can move several hundred orders a day. Still, he’s no stranger to using alternate storefronts to expand his business’ footprint online. He’s been experimenting with creating his own virtual concepts for years; two of them—a pasta concept and a wings concept—have become a permanent fixture of his business.
“I don’t want anyone to think that I am trying to do something dishonest. We didn’t build our business on dishonesty.”
He outlines a hypothetical scenario in which a long-time Devil’s customer stumbles upon a Future Foods brand like Groovy Island Pizza online. “Instead of ordering from somebody else, she’s ordering from me again,” he said. “Maybe Future Foods is doing some kind of promotion—$5 off for Groovy Island. She takes advantage of that.”
Listening to him talk about the various concepts he’s tried, I realized that last year, my partner and I ordered two late-night pints of ice cream from Devil’s without knowing it—via a virtual restaurant created by Unilever.
Other restaurant owners I interviewed signed on with Future Foods to carve out new streams of incremental revenue during the pandemic. One of them, Amin Bitar, runs an Eastern Mediterreanen gourmet grocery and prepared foods shop in South Philadelphia called Bitar’s with his brother, Jude. Opened by the brothers’ Lebanse immigrant parents in 1974, Bitar’s has the historical distinction of once being home of Philly’s first pita bakery—and has earned press kudos and a local cult following over the decades for its hummus, babaganoush, stuffed grape leaves, and falafel balls, which are grilled instead of fried. But in March 2020, as word of the novel coronavirus spread and offices in Center City started closing up, revenue from catering orders “dried up overnight,” Bitar said—and he began looking for ways to make up the shortfall.
Bitar’s had always been more of a foot-traffic business than a delivery-focused one. But when a representative from Future Foods approached him in early 2020, before the pandemic took hold, he hadn’t found the idea particularly out of the ordinary. Having grown up around his parents’ pita bakery, he was familiar with the “private label” business, where purveyors sell their foodstuffs to outside vendors for sale under a different name. “It wasn't a shock to us to say, ‘Oh my God, we’re going to put somebody else’s name on our product?’” he says. “I don’t care! As long as the register rings and my employees stay in their jobs and everybody gets paid—that’s all I care about."
After he rolled out an initial group of four brands in late June—Hummus Hero, Beverly Hills Platters, Bob’s Kabobs, and Fabulous Falafel—he said his contact at Future Foods reached out to say that the company he was “pleased with how [Bitar’s was] operating,” and helped him set up four more. By the time I connected with him, in January 2021, his restaurant was selling his tasty Meditterean food via 32 different online storefronts—on Grubhub, DoorDash, Uber Eats, and Postmates. And while he says it took a lot of back and forth with the company to work through some technical hiccups with the Otter system, the headaches paid off: The combined income from the eight brands he runs currently has “more than made up the shortfall from catering.” “Because of the program, we didn’t have to lay off anybody,” he said. “We actually added staff.”
Jonathan Donnelly, the owner of several restaurants in Chicago, said that cooking for Future Foods brands like “Pastrami & Pickles” and “Big Hotdog Energy” during the pandemic had rescued two of his businesses, including Lake View casual eatery Lucky’s Sandwich Co, from closure. Because of its location near historic Wrigley Field, Lucky’s had previously relied heavily on seasonal foot traffic, with business waxing and waning along with the success (and popularity) of the Cubs. When the coronavirus arrived, that critical revenue disappeared—and he needed to ramp up the number of delivery orders Lucky’s was getting.
After an ad for Future Foods showed up in his Instagram feed, he decided to give the service a try; within months, his delivery sales rose from about $3,000 a week, which is how much he’d been averaging since the start of the pandemic, to around $9,000. “At the end of the day, you’d rather have people coming into your storefront and buying beer and liquor and food from you directly,” he said, stressing that because of the steep third-party fees, delivery will always be a numbers game. “But basically right now—with no doubt, I would say—two of my places they have saved.” (He noted that government support has helped too).
Restaurateurs I spoke to described the Future Foods model as one that meets people where they are. Unlike with other virtual brand options Donnelly had explored, he said, restaurants typically don’t have to shell out for any ingredients or packaging they wouldn’t normally stock in their kitchen. (Though they may have to adjust their inventory to accommodate a higher number of orders.) And because participating restaurants can tailor Future Foods’ menus to items they already produce, there is not much of a learning curve for staff.
“[It’s] identical ingredients,” Bitar explains. “It’s just whether you put the tomato on top of the lettuce or the lettuce on top of the tomato.”
Cooks mostly just cook to the picture they see, just as they might ordinarily prepare an item in that kitchen. This makes Future Foods’ portfolio less like a collection of brands, in the usual sense, than a store of digital marketing assets—or skins—that restaurants can use to showcase their usual offerings in a different light.
In a 2020 paper for the research studio Bakersfield, Emma Kemp, professor at the Otis College of Art and Design, likens CloudKitchens-affiliated brands like Send Noods and and $ushi $nob—a Tumblr-esque concept I also spotted on the Future Foods carousel, created by self-described “WoRld FaMoUs DeSiGnEr 2 ThE StArZ” Ryan Haskins—to “visual ciphers.” “In the 2020 ghost kitchen economy,” she explained, “design is the product. The specifics of a menu, the integrity of the cuisine—both, ultimately, are of little concern. The branding signals only to itself, to a mood, an energy, a current, an idea of an experience.”
Instead of holding them to strict product parameters, several restaurant owners said, Future Foods seemed mainly concerned with giving them the tools they need to move inventory out the door. And rather than subject them to quality-control checks or undercover shoppers, the Future Foods model effectively outsources that work to the consumer: the positive or negative reviews that are left online, and the natural market adjustment that occurs as they impact customers’ purchasing decisions.
For someone who is trawling a delivery site late at night, searching for something to eat, the issue with a system like this is you can never know exactly what you’re ordering. While reporting this story, I decided to place an order with Lobbad’s Pimp My Pasta franchise: The pasta I received—penne with sun-dried tomatoes, mushrooms, and broccoli—was generously sized and garlicky in a compulsively eatable way, just like Devil’s pasta usually is. But on social media, you can find the occasional review from an unwitting Future Foods customer, gobsmacked by how little the meal they received resembled the picture. It’s a phenomenon one can attribute at least in part to the brand names, which sometimes seem as though they were engineered expressly to invite online snark.
Clark Feldman, a Minneapolis software engineer who moonlights as a referee on the indie pro wrestling circuit, told me that it was precisely that jokiness that inspired him to take a chance on F*cking Good Pizza when a “buy one get one free” offer popped up on his Uber Eats feed. He said he was struck by the declarative superiority of the name and product descriptions, and figured that placing an order would make for a good story.
He likens Future Foods’ brands to a “Trojan horse virus”: “It’s their way of getting into a space, without physically having to go and count how many orders are going out the front door.”
Sure enough, when his margherita arrived, it had none of the fresh mozzarella slices, green basil leaves, and delicately burnished edges of the pizza in the photo. “I could’ve made the same pizza by hitting the grocery store and grabbing a cheap frozen cheese pizza, some canned tomatoes, and one of those italian seasoning packets,” he said. He tweeted the entire story, which is how I found him, along with a photo of a sad-looking puddle of tomato chunks on dough. “You know those expectations vs reality memes? That’s how it turned out,” he said.
Though his experiences with Future Foods have been largely positive, Lobbad from Devil’s Pizzeria cited this sort of online chatter as his biggest anxiety about the relationship. He once stumbled upon a Reddit post from a local who had ordered from a Future Foods brand via another restaurant in town. The user had done some detective work because they were disappointed with their food, and singled out Devil’s as another Durham restaurant that was operating under several aliases.
In an industry where reputation is everything, Lobbad says he worries that incidents like this—events largely out of his control, such as other restaurants using these brands to market less-than-appetizing food, or a delivery app mishap that results in a customer’s food arriving cold—could damage the relationship he’s spent 13 years building with the community. “The downside is, if something goes wrong, the customer might be upset and they feel like you’re hiding, or that you’re not being honest with them,” he says. “That’s something I can lose sleep over, because I don’t want anyone to think that I am trying to do something dishonest. We didn’t build our business on dishonesty.”
As of publication, he hasn’t experienced any more problems. Still, he said that if any “negativity” comes from the relationship, he will “cut it off in a heartbeat.” A lot of people depend on his restaurant—including his family and his employees, who have families to support in turn—and he doesn’t want to run any risks. Since he discovered the Reddit post, he said he’s also had discussions with Future Foods about adding Devil’s name to each of his virtual storefronts, so that customers know exactly where their food is coming from.
Lobbad has a point: There are downsides to not knowing where your dinner is being made—and it’s an observation that applies just as much to Future Foods as it does the wider virtual brand landscape.
Marc Giguerre, a middle manager and musician who lives in Nashville, told me he too ended up ordering from F*cking Good Pizza last year. Taken together, the name, the photos, and the fact that DoorDash located the restaurant six miles away from his house led him to perform a certain mental calculus. F*cking Good Pizza’s offerings were slightly on the pricey side, and it was not that far from the East Side, “where there are all these overly hip places that have smarmy names like that,” he said. “I was like, I bet this is like five dudes from Brooklyn who moved here, because that’s the name of the game with Nashville.”
When his pizza arrived, it looked more like a thick-crust Papa John’s pizza than the New York-style pizza he thought he was getting. And to make matters worse, instead of coming in a F*cking Good Pizza box, it came in a box from a local chain he was never a fan of. “Quote-unquote ‘false advertising’—that term gets thrown around a lot, and truth be told, I don’t know the legal ins and outs of what it entails,” he said. Still, he said he felt he “got got”: “They are saying that it is one product with different pictures, under a different name—and they are selling you a product that isn’t that product. They’re not even being coy about it—it’s not like [the place even] put it in a F*cking Good Pizza box. Which if they did, by the way, I would have never found out.”
More than the food itself, it was the implications of the incident that drove him to take to Twitter to complain.
“I’m supposed to have some level of like, every dollar is a vote, but if I don’t know where my dollar is going, it totally takes away my ability to participate ethically in the free market,” he said. “The bigger implication is that you just have no way to be accountable with how you spend now.”
A world in which delivery app users find themselves scrolling through dozens of virtual concepts may have downsides for restaurants, too. “Ultimately, it gives people the paradox of choice,” said Matt Newberg, founder of the subscription media start-up HNGRY, which covers emerging trends at the intersection of food and technology. But, he says, “it also makes it incredibly more competitive”; the more brands there are to choose from, the less likely the consumer is to click on any individual storefront. As The New York Times has pointed out, it’s also easy to imagine a future where virtual brand companies with money to spend on prime placement in delivery app search results push independent restaurants lower and lower down the list.
Newberg, who got his start in the tech industry, has spent his fair share of time falling down the same Future Foods rabbithole that I did; he’s been writing about CloudKitchens, and its competitors in the ghost kitchen space, for years, and is something of a watchdog when it comes to the possibilities and perils of Big Tech in food. While he sees nothing wrong with restaurants using virtual brands as incremental sales channels during the pandemic, he says his greatest concern about Future Foods is one that restaurateurs may not even be aware of. “They’re giving restaurants tablets which would track all of their orders,” he said. “So any pizzeria that’s on [F*cking Good Pizza] is unwittingly sharing all this data with Otter.”
As he sees it, when you partner with Future Foods, you’re signing up to participate in what is essentially a “massive experiment on the restaurant landscape.” In addition to helping the company to market-test the concepts in their portfolio, local restaurants using Otter to consolidate their orders in one place are granting the company back-door access to valuable information on consumer preferences in your town—information that CloudKitchens could leverage down the road to compete with local restaurants from its own kitchens.
“Their whole game is to maximize the dollar per square foot on an industrial property for delivery, and then get some of the transaction,” he said. “And that requires selecting restaurants that are going to perform well on delivery—so if they know that your local pizzeria did well selling this brand, they’ll likely try to find someone to replicate that in their own space.” He likens Future Foods’ brands to a “Trojan horse virus”: “It’s their way of getting into a space, without physically having to go and count how many orders are going out the front door.”
In 2020, the pandemic forced more than 110,000 U.S. eating and drinking establishments to shutter either permanently or temporarily, according to a report by the American Restaurant Association. Even before the coronavirus hit, though, there were already other forces at play threatening the viability of the brick-and-mortar model, Newberg says: rising commercial real estate costs; a rapidly growing global delivery market; delivery apps that collect as much as a 30 percent of every sale, requiring restaurants to process a larger number of orders to make the same amount of money.
Newberg stresses that ghost kitchen companies like CloudKitchens didn’t create this set of circumstances. They are merely responding to macro-shifts in the industry that make operating a delivery-optimized business out of a shared kitchen a potentially more cost-effective proposition—although that may not be true for every business, and in the last year, commercial rents have taken a dip.
On one level, services like Future Foods could be seen as helping restaurants to weather these shifts, empowering them with tools for cutting through the clutter and grabbing customers’ attention online. But Newberg also sees the proliferation of these virtual storefronts as a sign that the company was using the pandemic as an opportunity to get restaurants to sign up for something that may not turn out to be in their best interests.
Future Foods isn’t a one-size-fits all solution, though. Dawn Skeete, owner of a Jamaican fusion restaurant called Jam’it Bistro in Redhook, Brooklyn, signed up with Future Foods in late 2020. As she started cooking for brands like OMG BBQ LOL and Devil’s Soul Food, though, she ran into a problem: Because none of the menus in Future Foods’ portfolio were a perfect fit for the Caribbean-focused dishes her restaurant normally prepares, she was finding herself having to shell out for new types of inventory—with no guarantee that she’d get enough orders on any given day for that investment to make sense. “When you dive down into the different restaurants [that are using it, you have to ask], ‘What is the ethnic background of the restaurant itself, what type of food is the restaurant providing?’” she said.
To make things work, she said she ended up incorporating certain Future Foods dishes onto Jamit’s regular menu, and discontinuing others entirely. But even then, she said, there were aspects of the arrangement that didn’t always correspond to the realities of running a restaurant in New York City. Together, she said, Future Foods and delivery platforms take a combined 40 percent of each order her restaurant fulfills. “That’s your entire profit margin,” she said.
“I am the one who’s responsible to get inventory,” she added. “I am the one who’s responsible to have the space and pay for the space. I am the one who’s responsible to have the staff covered. When you price a piece of chicken $5.50 and you’re taking 40 percent of that money—you’ve got to price a thing reasonably. Barbecue is very expensive.”
The majority of the restaurant owners I spoke to said they had been unaware of any connection between Future Foods and CloudKitchens or Travis Kalanick—though three noted that CloudKitchens had approached them at least once over the past few years, trying to get them to rent out kitchen space.
Andrew McDowell—founder and manager of With Love Market & Cafe, a natural foods grocer, kitchen, and community hub in South LA—said that cooking for Future Foods enabled the business to weather the losses engendered by a series of coronavirus-related public health mandates while keeping kitchen staff employed. This was a priority, since With Love is a social enterprise business, focused on addressing the local community’s lack of access to healthy food options and creating employment.
As someone with a background in digital marketing, he acknowledged that there were aspects of the Future Foods model that he found “brilliant.” For one thing, he said, these virtual brands seemed to be tapping into an emerging subset of consumers—people who are a “little more adventurous or deal/budget conscious,” and who “try something new all the time.” Still, he said, he didn’t like how little information Future Foods seemed willing to disclose about his virtual franchises were performing relative to other eateries operating them in the area, or what their respective coverage maps were—and how little control he seemed to have over an individual franchise’s growth, or lack thereof. “It’s completely on them, and there’s no visibility into it, and they will not talk about it,” he said.
For that reason, he says, we’ll probably be seeing independent restaurants taking the lessons they learned from working with Future Foods to roll out virtual brands of their own in the future. Another Los Angeles restaurateur I spoke to—Timothy Ratcliff, owner of Shin Ramen in Hollywood—has already been doing just that. After launching a number of Future Foods brands out of his kitchen, he said he was working on developing his own line of custom concepts, some of them in collaboration with a nearby Italian restaurant.
Taken together, the stories of these restaurant owners paint a picture of a food landscape where kitchens have to prioritize getting orders out the door at all costs, where a single negative review in a high-volume day can mean a night of lost sleep, and no one seems to have any control over what happens once the food leaves their kitchen. It’s a world that technology is transforming faster than people can keep up, in ways that no one seems to fully understand—raising complicated questions about the responsibilities tech companies have to food businesses, the responsibilities food businesses have to their customers, and who, if anyone, may be misleading whom.
One can only hope that the architects of food’s future will have the honesty to acknowledge that consequences of a single misstep along the way won’t look the same for everyone involved. Though a customer can bounce back after an under seasoned hamburger arrives at their door, a restaurant won’t always be able to recover from an onslaught of negative reviews—even in the best of economies. If a storefront for a brand like “F*cking Good Pizza” generates too much negativity, McDowell pointed out, Future Foods can just “shut down that listing and open up a brand new one with the exact same name.”
For now, restaurants hoping to make it to the other side will have to make the best of the tools at their disposal. At the very least, companies like Future Foods seem to know which way the wind is blowing. When I vented to Bitar about how fast the internet seemed to be changing the way we eat, he hit me with a dose of common sense. “If you walk outside your office, everybody’s head is in their phone!” he said. “It’s amazing people don’t fall into potholes walking down the street! So if that’s where everybody’s attention is, it’s smart for the people that figure out how to separate you from your money while your face is in your phone.”
And unless, like me, you have time to trace an eye-catching restaurant listing back to its source, you may never know where your dinner is coming from. When I drove out to an industrial area in Raleigh this past weekend to check out 3309 Durham Drive, the property that Alliance Health noted it was selling to City Storage Systems, I half-expected a scene that was buzzing with activity—a line of delivery drivers standing outside the facility and checking their phones, waiting for their orders to be called; a cloud of cooking exhaust floating into the sky. Instead, I found an empty parking lot next to a squat, mostly windowless brick building. And out on the street, a sign: “For lease.”
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