Jet founder Marc Lore plots U.S. expansion of food delivery biz: A ‘one-stop shop’ for cooked meals

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  • Entrepreneur Mark Lorre announced that he is CEO of food tech company Wonder Group, which includes Wonder, an on-demand food truck business, and Envoy, a one-mile courier platform.
  • The next year, Lore and her partner Scott Hilton planned to move Wonder and Envoy to Westchester County, New York; parts of Connecticut; Northern and Central New Jersey; and a part of New York City.
  • Wonder Group recently raised venture capital from investors including NEA, Accel, GV, General Catalyst and Bain Capital.
  • According to a person familiar with the financing, it has raised more than $500 million so far.

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Whether Americans are ordering a quick bite from a local fast-food chain, or they want to feel like they’re eating at a five-star restaurant from the comfort of the living room, Mark Lorre wants to redefine dining at home. Huh .

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The entrepreneur is finally going public about his latest e-commerce venture: a business that rivals DoorDash and Uber Eats with part food truck, part ghost kitchen.

The former head of Walmart’s e-commerce operations in the US has teamed up with Scott Hilton, who served as chief revenue officer of Walmart’s US digital arm, to start Wonder Group, Lore said in a statement on Tuesday. Posted on LinkedIn. Lor is the CEO of Wonder Group, while Hilton serves as CEO of Wonder, a division within the holding company that oversees a fleet of trucks with mini kitchens.

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CNBC reported Lores and Hilton’s involvement with Wonder in May, when the business was operating in stealth mode in the thriving city of Westfield, New Jersey. The two have since launched a delivery service for local restaurants called Envoy, which is similar to platforms like Grubhub and Seamless. The two businesses work side by side within the Wonder Group.

“It really is a one-stop shop for all cooked food,” Vidya said in a Zoom interview. “And we think there’s a real chance to be a winner-take-all in this market. … You really don’t need another app.”

The next year, Lore and Hilton plan to bring Wonder and Envoy to Westchester County, New York, parts of Connecticut, northern and central New Jersey as well as a part of New York City. Their ultimate goal is to expand across the country by targeting densely populated communities. Lore said the company plans to have 1,200 to 1,300 mobile kitchens operating in the Northeast next year and triple that by 2023. So far about 60 mobile kitchens are running in this.

‘On-demand home dining’

Hilton’s vision for Wonder is to provide American families with freshly cooked food from top chefs in all parts of the country.

The idea is that someone living in Upstate New York can order the famous cheesesteak sandwich from Atlanta-based Fred’s Meat & Bread. Or someone in New Jersey can order a wood-fired margherita pizza from Nancy Silverton’s Pizzeria Stockings, which is located in Los Angeles. Wonder partners with select restaurant owners, including Bobby Flay and Jonathan Waxman, to receive exclusive rights to recreate the items on their menus.

“Wonder is, in essence, a food and tech company,” Hilton said in an interview. “It’s on-demand home dining.”

Wonder also wants customers to receive their food while it’s hot. So once the driver reaches the destination, the final preparation of the food gets over inside the van equipped with kitchen equipment. Each Wonder Van has a trained chef onboard and is dedicated to only one restaurant.

Ingredients are prepared and packaged in a large central kitchen before being distributed to a smaller kitchen hub, which is accessed throughout the week by Wonder’s vehicles.

Hilton said until now in the markets where Wonder has been serving food, business has largely been word-of-mouth. The Wonder Vans, with the company’s logo, function to some extent as roaming billboards, he said.

Wonder is currently operating with 17 restaurants, serving approximately 17,000 homes in New Jersey. As more restaurant options are added to the platform, a user is more likely to return and order dinner from Wonder again, Hilton said. The company is also planning to serve breakfast and lunch soon. Most recently, it began offering a selection of desserts and added cocktails after receiving a liquor license.

Wonder and Envoy are coming out of stealth mode at a time when more Americans have adjusted to eating at home during the pandemic. Some consumers have chosen to cook their own food, while others have turned to takeout and delivery from their favorite restaurants. Experts predict that some of these behaviors will stick around even as the fear of Covid subsides.

To be sure, food delivery is a tough business to be in and make money. For example, DoorDash has seen sales growth in recent months but remains unprofitable. Its net loss more than doubled in the three-month period ended September 30. And ride-hailing company Uber has long lost money on its Eats division.

Envoy, in particular, uses its own fleet of cars and drivers separate from the Wonder.

According to Hilton, Wonder’s advantage compared to other food delivery platforms is that it only serves homes in a designated area to make multiple deliveries in a single trip so that a driver doesn’t make an “empty” run. And since the company prepares food on a large scale in a central kitchen, the process helps keep the cost of the meal lower than in a restaurant, he said.

According to Lore and Hilton, for a Wonder van to break even for the evening, it needs about $100 in sales per hour.

A page from Netflix’s playbook

Lore, who co-founded Jet.com before it was sold to Walmart, said Wonder’s strategy is like taking a page out of Netflix’s content playbook.

“We want to lock down all the best proprietary content,” he explained. “Every chef that’s well-known—every restaurant that’s great—we basically want to shut it down and put it exclusively on Wonder.”

“We know there will be competitors one day, but we will have all the great content shut down ahead of time,” Lore said.

Wonder Group recently raised venture capital from investors including NEA, Accel, GV, General Catalyst and Bain Capital, Lore said. The company declined to provide figures on total funding. However, a person familiar with the financing said it has raised over $500 million so far.

Since leaving Walmart earlier this year, Lore is now part owner of the NBA’s Minnesota Timberwolves alongside former baseball star Alex Rodriguez. The duo’s venture firm Vision Capital People is also looking to make other bets on digital commerce. Meanwhile, Vidya is working on building the so-called utopian city of the future, called Telosa.

But Vidya said she devoted all her “business” working time to the Wonder Group.

“I feel like I’ve been kicked out of a cannon. … I just had all these thoughts flowing,” Lore said of his time leaving the big-box giant. ,[Wonder] It’s an opportunity to really change how we think about food – how we eat.”

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