Tag: Other

09 November 2018

Fyodor Ovchinnikov

Fyodor Ovchinnikov

Dodo Pizza CEO

A few words about food tech and Zume Pizza which has reportedly received $375 million of backing from the tech investment firm SoftBank while being evaluated at $2.5 billion. Zume is a Californian startup which employs robots for kitchen work automation. The company also invented a technology for making pizza on the go in remotely controlled ovens.

I’m sure that the engineers at Zume Pizza are very smart, and I have no doubt that the company has come up with some cool inventions. Still, I’m really surprised by such a high evaluation. As a person deeply involved in the pizza business, I decided to share a few thoughts on the matter.

Dmitriy Grishin, Mail.ru chairman and one of the Zume Pizza investors, commented on the deal thusly: “Instead of 30-minute delivery, there will be a five-minute delivery.”

Such statements might look convincing—but only for people who know nothing about the subject. Let’s plunge ourselves into details. If you make pizza in a car, it doesn’t mean that your customer will get it in five minutes. For a five-minute delivery, the car must be driving pretty close to the building.

How many cars will you need to ensure this five-minute delivery? How will it be possible to meet the demand during rush hours? What CAPEX and OPEX will a pizzeria show if it has to maintain not just one oven in its only locations, but a dozen in each of its cars? All these questions won’t seem meager and unrelated for anyone who ever managed even a tiny pizza shop.

It seems noteworthy that judging by Zume’s reviews on Google Maps, pizzas sometimes are not delivered even in 30–40 minutes.

“…My husband and I were very excited to try this place but will never order from here again. First, the order took 1hr and 10min to get here (so much for fast) and the driver went to the wrong house.”

“…Our pizza took 3.5 hours to arrive. They ran out of the one we selected, so the computer freaked and simply didn’t complete our order. We’d already paid, so I wasn’t going to re-order! I called customer service multiple times and it took 30–45 minutes to get the situation resolved.”

Yes, Zume’s tech is a work in progress. It will become better. But it looks like Zume Pizza has technology, but doesn’t have a working business model.

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