- Tech entrepreneur Marc Lore debuts his revamped food-tech startup Wonder in New York City this week.
- Instead of using kitchen vans, Wonder is preparing chef-driven meals from a storefront.
- Wonder sells high-quality meals from well-recognized chefs and restaurants in the US.
Forget the hassle of New York City restaurant reservations.
If tech entrepreneur Marc Lore has it his way, Manhattan's next culinary hotspot will be the customer's doorstep, through home delivery of high-quality meals created by some of the most recognizable restaurants and chefs in the US.
The former head of Walmart's e-commerce business is the CEO of Wonder. The food-tech startup began by preparing meals in vans parked outside customers' homes in New Jersey but is pivoting to delivering meals from storefronts using couriers on electric bikes.
Lore's revamped food tech startup launches its new service from a storefront on the Upper West Side this week.
Lore, who cofounded the e-commerce site Jet.com and sold it to Walmart, had plans to expand Wonder to a fleet of 1,000 kitchen vans. But in early January, the startup laid off staff and shuttered the vans, which were equipped with TurboChef ovens where drivers would finish partially cooked meals.
"The trucks were working well," Lore insists.
The Mercedes vans consistently made $500 a night, the amount needed to break even. But, Lore said, "one of the biggest challenges we found with that business was finding suitable parking lots to put the trucks."
According to the Wall Street Journal, some residents also complained that mobile kitchen vans were noisy, but Wonder told Insider that most residents embraced the "elevated" service.
"We've always appreciated how welcoming everyone was," the company told Insider. "The decision to shift our operational model was made to help us serve more customers and grow more efficiently."
In an interview last week with Insider, Lore said by shifting to delivery or takeout from a fixed location, Wonder can scale faster. Storefronts can offer consumers up to 30 food brands for delivery from one location, while the van model was limited to two menus per van.
"We just found a better way to offer a higher quality customer experience and at the same time make a better profit margin," Lore said.
The rebooted Wonder uses part-time couriers to make deliveries on electric bikes. The 2030 Broadway location opens Thursday, offering dishes curated from eight restaurant brands, including Indian cuisine from a James Beard award-winning restaurant, Greek food from Food Network star Michael Symon, and regional Mexican food from Barrio Café in Phoenix, Arizona.
By the end of the year, Lore said Wonder plans to offer New Yorkers 30 restaurant brands, allowing customers to bundle "fast fine" meals created by chefs such as Nancy Silverton, José Andrés, and Bobby Flay.
"You can get high-quality meals delivered fast. That doesn't exist anywhere," he said.
Wonder prepares food in a New Jersey commissary and finishes it in TurboChef ovens run by employees on the Upper West Side. The hub-and-spoke model allows Wonder to deliver "hot food" in 20 to 35 minutes, depending on the time of day, Lore said. It charges a delivery fee of $1.99.
Wonder's service is limited to a six-block radius, ensuring a hot meal is delivered within 10 minutes after it is prepared, Lore said.
Ghost kitchens like Hungry House in Manhattan and Brooklyn and Kitchen United have similar business models, where food is available for delivery and takeout from one space.
But Lore said there's nothing ghostly about Wonder.
It has limited dine-in space, owns the menus and recipes it serves, and has its own fleet of bike couriers. The tip-eligible workers are paid $15 an hour with a wage guarantee of $21 an hour with tips. Traditional ghost kitchens rent space to brands, who cook their menus for delivery only using third-party apps.
"We're vertically integrated. We do everything. It's our app. It's our delivery, and it's our cooking," Lore said. "We own the rights to those brands."
ClusterTruck, a Midwest ghost kitchen that controls everything from the food recipes to delivery, is another model similar to Wonder. ClusterTruck has its own drivers and doesn't work with third-party delivery apps.
Still, Lore sees the value of marketing Wonder's food brands on delivery apps. On Thursday, in addition to ordering from the Wonder app, consumers can order each brand on Uber Eats or Grubhub, but Wonder's couriers will perform the delivery.
Each location, when working at capacity with 30 brands, has the potential to make $10 million in revenue a year, he said. By the end of 2023, Wonder plans to have 10 locations, with the next two openings coming to Chelsea in Manhattan, and Westfield, New Jersey.
"People have told us in the restaurant industry that New York City, Manhattan specifically, is the hardest place to make a restaurant work, and if you can make it work here, you can make it anywhere," Lore said. "So once we prove it here, we're gonna feel pretty confident going into new cities."
On Wednesday, Wonder is launching with eight brands. Most are foods from famous brick-and-mortar restaurants in New York and the US, including Di Fara Pizza in Brooklyn, Chai Pani in Asheville, North Carolina, Tejas Barbecue in Texas, Barrio Café in Phoenix, Arizona, and Fred's Meat & Bread in Atlanta. In March, Lore said to expect more brands to launch.
Wonder owns the rights to menus created in collaboration with chefs like Nancy Silverton and Jose Andres, who hold equity stakes in the company. Wonder also owns the same rights to the food it sells from award-winning restaurants such as Tejas Barbecue, which also have an equity stake in Wonder.