Last year, on-demand delivery startup Danny Burrito initiated a Pozible campaign to deliver burritos to its customers within a 15 minute timeframe. With a small team, the scalability of Danny Burrito was questionable and founder James Jordan decided to put it on the back burner to pursue a wider issue in the foodtech industry-kitchen space.
From working in the fast food and on-demand industry Jordan realised that Friday, Saturday and Sunday nights were the only times during the week that really made money. According to the Enhanced Media Metrics Australia report, on average Australians make 51.5 million visits to fast food restaurants every month. However, most of those visits occur during the evening and night time.
A report released by the Council of Capital City Lord Mayors earlier this year explored the performance of Australia’s night-time economy and found that compared with the day-time economy, employment growth in the night-time economy experienced strong annual growth of 2.2 percent.
Given the change in food dining experiences and activities, Jordan saw that it was more feasible to set up his food delivery service on Friday, Saturday and Sunday nights. In doing so, Jordan needed to rent out a kitchen space from either catering companies or food truck services. In exploring his options Jordan stepped outside at 4pm in Sydney for a coffee and discovered that most cafes and restaurants were closed.
“I thought surely I could rent one of these out and just deliver on the weekend. So that’s what I did, and then pretty quickly I realised that this could be a massive, unused potential where, for other businesses like Danny Burrito, to rent out this unused space,” said Jordan.
It was after this revelation that Jordan started pursuing another foodtech startup venture, called Sprout Kitchen. The Melbourne-based startup is an online platform that allows businesses to rent out flexible kitchen space. Sprout Kitchen provides a service for restaurants to expand into new suburbs and areas without the overheads of cost and a locked in contract.
“We find cafes and restaurants with unused kitchen space, and we list it on our online platform,” explained Jordan.
Spout Kitchen has a listing page that adds all the available kitchen spaces where users can search in terms of price, size and area. For restaurants, Sprout Kitchen provides a platform where business owners can list a space for rent during unused times in the week, month or year.
In terms of renting spaces for food preparation, there are many compliance laws that need to be adhered to. The Victorian Government has released initiatives like StreetTrader.com to help break down the barrier of regulation and what people need to do in order to comply with food safety.
The biggest issue with a startup like Sprout Kitchen is ensuring trust between both customers, that is the kitchen space and the user. Jordan has a large task on his hands in making customers feel comfortable in offering up their kitchen spaces for a typical on-off use.
“The three main concerns are the insurance, cleanliness, and security. We provide our insurance policy and we’re partnering with an insurance company in Australia to help us provide that specific insurance,” explained Jordan.
Sprout Kitchen also supplies restaurant or kitchen owners with a guidebook that details certain standards and processes to ensure the maintenance of food safety and compliance. The guidebook also offer basic food hygiene and is given to each customer who books out a kitchen.
For security, Sprout Kitchen has a lockbox standpoint that contains the keys to the kitchen space. Once a user has been accepted and registered, Sprout Kitchen gives them a special code to access the keys. Once a user has logged into the space, the startup tracks the exact amount of time the space was in use to make sure any extra hours are monitored and billed.
Currently Sprout Kitchen is only available to existing certified food businesses. Jordan said that as the trust of the brand grows, he wants to open the startup up for anyone to book a serviceable kitchen space around their city.
Sprout Kitchen is currently working out of Melbourne and was accepted into the Slingshot’s Simplot Ignite foodtech accelerator program. The program has invested $30,000 into the foodtech startup and through demo day, Sprout Kitchen pitched its idea to an audience of investors to gain more traction and funding to expand.
Jordan said that once Sprout Kitchen is up and running his former startup Danny Burrito will be the first customer. Being the founder of one startup and also a customer of another gives Jordan a great opportunity to test his idea. As Sprout Kitchen grows, Jordan may have to continue its priority over Danny Burrito, which leaves us to question who will pick up the on-demand burrito business that we were all so looking forward to?
Image: Simon Cusack and James Jordan. Source: Supplied.