The pace of technology innovation in the restaurant industry has been accelerating in recent years. When it was founded a couple of decades ago, OpenTable was one of the first Internet companies to provide technology to restaurants. More recently, we’ve seen an explosion of technologies aimed at this industry, be they new delivery services, food marketplaces, or discovery platforms. The pandemic only accelerated this trend as alternatives to in-store dining grew in demand.
Another disruptive technology is cloud kitchens, which typically offer on-demand, commercial-grade workspaces to help restaurants and chefs grow their business or expand their delivery radius. They also typically leverage the new restaurant delivery services to address ‘last mile’ challenges.
While it’s easy to assume the same pace of innovation has taken place across the restaurant industry globally, look a little deeper and you’ll quickly find that varying cultural, economic, geographic, and regulatory factors actually give the industry in each country a unique “flavor.”
Latin America has a number of unique characteristics in their legacy restaurant business which create an intriguing opportunity for cloud kitchens. First, the per capita penetration of restaurants in Latin America is very low compared to geographies such as the U.S. and Europe, meaning that diners have fewer restaurant options. The majority of these restaurants are also ‘independents’, which has two impacts:
- The region has a relatively low penetration of ‘chain’ restaurant concepts and thus the consistency they bring to consumers.
- New restaurant trends (think poke bowls and bubble teas, currently) are often slow to roll out across the region.
Entrepreneurs Daniela Izquierdo and Juan Guillermo Azuero believe these unique characteristics of the Latin American restaurant industry create a new opportunity for cloud kitchens, enabling them to become a ‘virtual restaurant developer group.’ Their company, Foodology, currently operates seven bespoke restaurant brands which, from a customer standpoint, appear to be independent restaurants. However, in each city they operate in, all share the same commissaries and kitchens. This offers Foodology economies of scale across major expense areas including real estate, ingredients, and staff. Already, their breakfast brand “Brunch & Munch” is the #1 breakfast delivery brand in their native Colombia, while their salad brand “Avocalia, is #2 in that category.
When we were introduced to Daniela and Juan, we quickly saw the opportunity for Foodology to redefine the role technology will play in transforming Latin America’s foodtech space. And as the Latin American market increasingly adopts digital platforms and services, that opportunity only grows.
Today, we’re excited to announce that we will be leading Foodology’s Series A round in partnership with Base Partners. The company plans to use the capital to expand operations to more cities across Colombia and Mexico, enter new countries in the region, and continue developing bespoke restaurant brands. Foodology’s vision is to have the defining set of virtual restaurant brands that they can launch and operate across the Latin American region, putting them in prime position to take advantage of new restaurant industry trends. Buen provecho, Latin American diners!
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