Wonder has made improvements to its food quality. | Photo courtesy of Wonder
In a few decades, many consumers will have almost all of their meals delivered. Some will arrive hot and ready to eat, and others will just need to be popped in the oven. The lineup will be optimized by AI to meet each person’s tastes and dietary needs. And some of the recipes may be created by the customer themselves. It will all cost about the same as going to the grocery store or the drive-thru.
That, at least, is what Marc Lore is betting on with Wonder.
The company, which now encompasses a chain of 140 food halls, Blue Apron meal kits, the Grubhub delivery service, and a robotics division, is aiming to do nothing less than upend how Americans eat. Through a combination of broad selection, low prices, and convenience, it hopes to become consumers’ go-to source for meals, “delivering, hopefully one day, 21 meals a week,” Lore said in an interview.
He predicts customers will still go out to eat regularly, and may still cook sometimes for fun. But fast-food chains and grocery stores stand to lose business in the future he envisions.
“If you believe you can bring down the price point to where a fast-casual burger doesn’t cost much more than fast food, and it’s available in all the same places, then of course it’s going to eat into fast-food share,” Lore said in an interview. “So I do think that area will be under pressure if we are as successful as we would hope one day.”
This sea change in consumer eating habits will take decades, he cautioned. Today, Wonder is a relatively large and growing business, backed by more than $3 billion in private funding, including a fresh $650 million this week. It is valued at more than $9 billion, more than some much larger restaurant companies, and has an initial public offering on the agenda. But it is still a long way from doing what Lore is describing on a large scale.
According to a report by The Information earlier this month, Wonder expects to generate just under $2 billion in net revenue this year, $3 billion next year, and $5.5 billion by 2030, and won’t start generating cash until 2029. Wonder has declined to comment on the report.
But Lore said the business is growing. New locations in the suburbs are doing better than older, urban locations, because there is less competition and more families, a key audience for Wonder. And Grubhub, in decline when Wonder bought it a year and a half ago, has turned around under its new owner, Lore said.
The thing that excites Lore the most right now, he said, is Wonder’s food. The company has been working to improve its food, based on customer feedback on each meal, which they’re asked to rank on a scale of 1-10.
“If you try the food today versus a year ago, it’s night and day,” Lore said, noting recent upgrades to its burger and other items currently in test. “Our taste scores, our Google review scores, everything’s moving up and to the right.”
Meanwhile, many elements of Wonder’s longer-term strategy, including create-your-own restaurant concepts and full kitchen automation, are in the works.
Here’s a look at the various pieces of the plan.
Restaurants
The central element of Wonder’s “mealtime platform” are its brick-and-mortar locations. These outlets offer dozens of proprietary, licensed, and existing restaurant brands for delivery, pickup, and dine-in, all from a single kitchen. Menus cover a wide range of cuisine types, from burgers and chicken to Mexican, Indian, and Asian. Wonder has recently been bolstering its selection with well-known local concepts, such as Blue Ribbon Fried Chicken and the eight-unit Mighty Quinn’s BBQ. It will announce another acquisition in the next few weeks, Lore said.
Currently, there are 140 Wonders and counting in 10 East Coast states and Washington, D.C. It plans to enter Texas next year.
Meal kits
Though Wonder is frequently labeled a restaurant business, it is equally focused on meal kits, Lore said. But it wants to shift from the traditional boxed recipes that customers cook themselves to oven-ready meals. It plans to make these as affordable as groceries by automating production and delivering them alongside hot meals, bringing down transportation costs.
Delivery
Wonder’s delivery-focused food hubs are connected to Grubhub’s delivery network. This allows Wonder to coordinate deliveries more easily and keep costs down because it is not paying commissions to a third-party service. Eighty-five percent of Wonder’s traffic comes through its own app and website, Lore said. And when it opens a new store in a new market, it has a built-in delivery network to tap into.
The company is also testing drone delivery, a technology Lore has high hopes for. It’s faster than driving, he said, and more affordable for customers because they don’t have to tip. “That’s where we’re gonna be headed on the delivery side is drones,” he said.
Robotics
Much of Wonder’s plan to lower prices rests on automating its kitchens. It took a step in that direction last year with the acquisition of Sweetgreen’s Infinite Kitchen, a machine that makes bowls. Since then, Wonder made some tweaks and changed the name. Now called the Infinite Makeline, it is an “ironclad” system that can produce 500 bowls an hour, including salads, Mexican, Greek, and other bowl dishes. It rarely goes down and is easy to fill and clean, Lore said. It will go live in Wonder’s Midtown East location in Manhattan in three weeks.
Wonder is also developing an Infinite Sauce machine. It will be able to produce 500 sauce cups an hour in 3- and 6-ounce sizes, and will allow customers to create their own sauces with varying heat and ingredient levels, adjustable down to the milliliter.
The company has plans for two other robots that are expected to go live next year. The Infinite Beverage machine will allow customers to create Starbucks- and Dutch Bros-like beverages to spec. And the Infinite Mise is “a 15-foot-tall robotic retrieval system” with cold storage that will pick and deliver items to different cooking stations in the kitchen. For instance, if someone orders wings, it will grab wings and bring them to the fryer where an employee will cook them.
By 2028 or 2029, though, employees won’t be needed to cook at all. By then, Wonder is planning to launch automated versions of its kitchen equipment, including fryers, clamshells, woks, and ovens, all built from scratch.
“Don’t think about a traditional fryer with a humanoid robot doing the fries or a robotic arm, but the fryer built where the food runs through the fryer tunnel and comes out the other end fried,” Lore said.
With all of the automation, Lore said, Wonder stores will be able to add 20 points of profit margin compared to traditional restaurants, allowing it to keep prices lower.
Make-your-own restaurant concepts
In November, Wonder will launch Wonder Create, a program that will allow anyone to create their own restaurants using Wonder’s ingredients and production process in a matter of minutes. They’ll be able to scale these DIY concepts across as many Wonder locations as they want for $10 a month per location, and will get 10% of the revenue that their creations generate.
The restaurants will be customizable down to the specific portion size and micro and macronutrients, made possible via AI and robots like the Infinite Makeline and the Infinite Sauce machine. They’ll also be able to come up with their own brand names and menu descriptions.
“I could see individuals building their own restaurant just for themselves, maybe their family, because you get a perfectly made bowl to your proportions, with your own sauce, a great delivery experience, and you’re effectively saving 10% because you own the restaurant,” Lore said. “In the next 10 years, I think there’s gonna be millions of restaurants that people own.”
He added that Wonder is already seeing a lot of interest in Create.
AI-powered meal plans
Wonder is also developing a program called MEL that will automatically decide what customers eat. Users will upload their health data, food preferences, and budget, and the system will create a meal plan based on Wonder’s inventory and have it delivered to their home. Customers will be able to then grade each meal so MEL can continue to learn their tastes.
“The idea is that one day, Wonder will autonomously feed you every meal,” Lore said.
He admitted that it sounds a bit sci-fi, but said that he has been doing it himself for the past year. It took some time for MEL to learn his routines and preferences, but after hundreds of meals and thousands of comments, it now knows every detail of Lore’s dining habits.
“It knows me so well that it’s better than I could possibly do myself,” he said. “It’s like, the best version of myself.”
