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Amid pandemic, robotic food companies have fresh selling point

Robot-prepared food companies see opening as COVID-19 has heightened food safety concerns.

Bloomberg, Content provider

June 13, 2020

5 Min Read
 robotic barista at Cafe X makes coffee drinks on February 12, 2019 in San Francisco, California. Cafe X is one of several fo
A robotic barista at Cafe X makes coffee drinks in San Francisco, California. Justin Sullivan/Staff/Getty Images News/Getty Images

By Sarah McBride

Vertical agriculture company Plenty Inc. has an unusual selling point: Its crops of arugula, kale and microgreens are grown in an indoor farm run by robots. That hasn’t always been a winning proposition. Two years ago, the company had to scale back an ambitious international expansion plan, realizing it wasn’t ready to bear the cost of pricey new markets despite having taken more than $200 million in funding.

But now, with coronavirus heightening food safety concerns, Plenty has a fresh angle. From planting through harvest, its vegetables don’t encounter human hands, meaning fewer chances for virus contamination. “What people seem to be wanting is they want to know their food is safe,” said Chief Executive Officer Matt Barnard. Plenty, which is backed by SoftBank Group Corp, sells packaged greens indoors and on automated vertical planters. “Our goal is for the person eating the food to be the first one who has touched it,” he said.

Before the pandemic, robot-prepared food companies were a hit with investors, but ambitious sales goals didn’t materialize. Last year, robot coffee maker Cafe X shuttered locations, and pseudo-robot café Eatsa and robotic pizza-chef Zume pivoted to different businesses. Zume, formerly Zume Pizza Inc., raised $375 million from SoftBank in 2018 for its vision of having machines assemble pizzas in the back of moving vehicles. By this year, the company had cut 360 employees, put its double-decker pizza making party bus named “Martha” up for sale at a discount, and refocused on sustainable packaging.

Related:Stopping foodborne illnesses

Many much-hyped robotic food companies couldn’t realize the cost savings needed to justify their research and development and equipment, even if they were able to hire fewer humans. The robots also just weren’t very appealing. Who wants an android to season their pizza? But Covid-19 concerns have hit food preparation particularly hard, upending restaurants’ typical calculus. Now, the coronavirus has given those companies a new hook for human-free preparation.

At Plenty, Barnard said shipments are now about 30% higher than before the pandemic struck, in part because the greens filled gaps at grocery stores whose normal supply chains were disrupted. In recent months, he won new customers like regional grocer Mollie Stone’s.

Plenty’s systems haven’t always sounded great to grocers. For example, when it comes to packaged greens, Inc.’s Whole Foods normally opts for pre-washing, a process that usually involves diluted bleach and saline. But Plenty argued that washing its robot-nurtured veggies—which grow without dirt and under LED lights with a customized spectrum—would not make them cleaner, and might actually make them dirtier. Eventually, after an extensive audit of Plenty’s facilities, Whole Foods relented. (A spokesman for the company said it has “extremely rigorous” standards for leafy greens.) Plenty’s produce arrived on Bay Area Whole Foods shelves in January, just in time for pandemic panic-purchasing.

Related:Senators want action on food safety

Even at large companies, hands-off assembly processes have become a focus of advertising. On its website under the section Covid-19 Updates, Pizza Hut notes: “Your pizza leaves our 400+ degree oven and slides hands free into the box so the only person who touches it after it comes out of the oven, is you.”

For those not inclined to order food or leave the house, there’s Stockwell, a souped-up robotic vending machine that sells staples like aspirin, dried noodles and paper towels. In the apartment buildings where the machines are installed, the average monthly tab per user has shot up since February, when shelter-in-place orders started going into effect, said DCM investor David Cheng, who has backed Stockwell and Plenty.

“It’s a better experience,” said Cheng, who believes the machines help allay Coronavirus-driven “fear and discomfort” when it comes to buying products. After consumers try the machine for health reasons, Cheng added, they typically return once they realize how convenient it is, particularly the mobile payment feature.

But the pandemic has not been an unalloyed blessing for food tech companies. Spyce, a venture-backed restaurant in Boston that relies on a robotic kitchen, had already closed late last year to allow for more meal customization. Now, the pandemic has delayed the necessary construction and reopening by months.

“Food safety and sanitation is a big deal right now, and we think we can do a good job,” said CEO Michael Farid. But until it can reopen, Farid will have to wait.

The complexity of building robotic systems could keep more restaurants from embracing the technology. “Being able to meter, dispense and portion food is challenging,” said Daniel Fukuba, co-founder of Ono Food Co., an automated food-assembly company with a mobile kitchen in Los Angeles. One of the most advanced systems, he said, belongs to Creator, a burger company that’s had its own recent challenges.

Creator is a venture-backed startup that uses elaborate robotic choppers, dispensers and grills to assemble hamburgers on a conveyer belt. Initially Creator billed its setup as fun and futuristic, but when the pandemic hit, the company switched its messaging to focus on safety, writing, “Be the first to touch your burger,” in promotions. Creator engineers also developed what CEO Alex Vardakostas called a “transfer chamber” to allow its few human workers to accept an order and place it on a self-sanitizing conveyer belt that takes the burger through a pressurized box to prevent outdoor air from contaminating indoor air, and crank it through to the outside for pickup.

But even the pressurized transfer chamber couldn’t keep Creator from feeling the effects of the lockdown. Last week, Creator said it was temporarily closing its doors, citing low traffic in its office-heavy San Francisco neighborhood. “We haven’t seen a coyote or tumbleweeds on Folsom Street yet, but it’s getting there,” the company said in a social media post. The plans for the touch-free transfer chamber and air pressure systems are still available on its website to be downloaded for free for any other restaurant that wants them.

To contact the author of this story:

Sarah McBride in San Francisco at [email protected]

To contact the editor responsible for this story:

Anne VanderMey at [email protected]

Molly Schuetz

Mark Milian

© 2020 Bloomberg L.P.

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