Speaker 1: This is Bloomberg Business Week with Carol Masser and Bloomberg
Speaker 1: Quick Takes Tim Stinovic. On Bloomberg Radio. Earlier this month,
Speaker 1: we noted that the food trucks startup Wonder, although I'm
Speaker 1: not sure that that's quite the exact perfect description, but
Speaker 1: we'll get into that in just a moment. It is
Speaker 1: led by a Jeck dot com founder, Mark Laurie. It
Speaker 1: has raised three fifty million, bringing its total fundraising hall
Speaker 1: to just under a billion. In a market where checks
Speaker 1: are getting harder to come by, It's been, we know,
Speaker 1: a very volatile market. Latest funding raise giving Wonder a
Speaker 1: three and a half billion dollar valuation according to people
Speaker 1: familiar with the matter. So we wanted to get an
Speaker 1: idea of a little bit more about what this company
Speaker 1: is all about, what they're going to do with all
Speaker 1: that money. Tim. We've got the CEO of Wonder, Scott Hilton,
Speaker 1: joining us on Zoom from Parsippany, New Jersey, also the
Speaker 1: former Chief Revenue officer of the US of US e
Speaker 1: Commerce at Walmart. Scott, great to have you with us,
Speaker 1: How are you good? Thanks for having me, Well, it's
Speaker 1: great to have you here. Okay, So Carol lives in
Speaker 1: New Jersey. I don't know if she lives in a
Speaker 1: part of New Jersey where Wonder operates, but it's based
Speaker 1: in New Jersey right now. And she described it as
Speaker 1: a food truck. Um, and at its core, that's that's
Speaker 1: what it is. But it's also so much more So
Speaker 1: how would you describe Wonder? Yeah, it's so food truck,
Speaker 1: that's kind of the first thought that people have that
Speaker 1: it really is something completely different. So what what we
Speaker 1: are is it's on demand dining, so customers can order
Speaker 1: be an app. They have access to a range of
Speaker 1: restaurants from everyday food you know, pizza burgers all the
Speaker 1: way up to find dining like Bobby Flay Steak Uh.
Speaker 1: As soon as they order, a mobile restaurant will show
Speaker 1: up at their location and cook that food hot uh
Speaker 1: and fresh right there at their location and serve it
Speaker 1: through their door. So within minutes after ordering, they enjoy
Speaker 1: really a restaurant quality meal wherever they are at their
Speaker 1: home or at a park or at work. I'm so
Speaker 1: in after getting delivery, after delivery that's cold and not
Speaker 1: at all. Even if it's from a great restaurant, it
Speaker 1: just doesn't doesn't fly. Um, So tell us about the
Speaker 1: growth that you're seeing. Give us an idea of the metrics,
Speaker 1: who are your customers, where you're seeing the growth, and
Speaker 1: what you want to do with all this money. Yeah,
Speaker 1: so we uh we served twenty two towns now in
Speaker 1: New Jersey. It's about a hundred households. Uh, and it
Speaker 1: ranges in old demographics from something that looks more Middle
Speaker 1: America all the way up to a little bit wealthier towns.
Speaker 1: All those towns are growing. Customers have been really going
Speaker 1: crazy for this um are. We have really high scores
Speaker 1: and it's it is a truly a great experience. UM.
Speaker 1: It was one of the reasons that the company was
Speaker 1: founded is is looking at the delivery platforms, Uber, Eat, Store, Dash, etcetera.
Speaker 1: They were growing like crazy before the pandemic. UM, but
Speaker 1: the but the customer experience was really lacking. UM. There
Speaker 1: was the quality, uh, the food problem cold or you know, uh,
Speaker 1: you know, kind of moist food as a steams on
Speaker 1: the way to the customer, as well as just having
Speaker 1: access to those great restaurants. So that's really at the
Speaker 1: core of what we're what we're trying to solve, and
Speaker 1: it's working in all segments and so we're continuing to
Speaker 1: expand more as to the money that we've raised is
Speaker 1: going into the mobile restaurants themselves, the fleet um as
Speaker 1: well as just covering normal operating expenses. But the bulk
Speaker 1: of the bulk of the money is for expanding and
Speaker 1: going and using it for the mobile restaurants. One thing
Speaker 1: that caught my eye though, in reading about this a
Speaker 1: few weeks ago in the Wall Street Journal, is that
Speaker 1: Mark Laurie said to the Walls Journal that the company
Speaker 1: have aims to have a national footprint by twenty five.
Speaker 1: That's many, many many years away. And I mean you've
Speaker 1: worked at several different companies in that time period and
Speaker 1: the number of years that it would it would happen.
Speaker 1: Think Marcus probably started and sold two different companies for
Speaker 1: hundreds of millions of dollars and several billion dollars in
Speaker 1: that you know, thirteen years that it would take to
Speaker 1: get to five. Why such a long period of time, Well, Uh,
Speaker 1: we're starting here in the northeast, um in the Tri
Speaker 1: state area, and will the time being be focused there
Speaker 1: as we grow out, but very quickly. The way of
Speaker 1: how we structured this model is we've been building up
Speaker 1: the infrastructure. It actually has taken its years to get
Speaker 1: the methods figured out how to do this. We prep
Speaker 1: and park, cook our food and fairly large scale central
Speaker 1: kitchens that food is sent out in our cold chain
Speaker 1: to this fleet. Um, we can do that in parallel,
Speaker 1: you know, in many cities. So as we continue to grow,
Speaker 1: we'll be opening up different areas simultaneously across the country.
Speaker 1: But it just takes time to kind of get that
Speaker 1: infrasture infrastructure going before we uh, you know, start to
Speaker 1: scale beyond the northeast. What the trickiest part of it
Speaker 1: is it? People? Is it is? You talked about this
Speaker 1: infrastructure that you know takes a while to set up. Um,
Speaker 1: what is the trickiest part? There's no single thing that
Speaker 1: stands out. You know if you ask me that same
Speaker 1: question maybe two years ago, Uh, it was could we
Speaker 1: actually create this incredible food in this process? And that
Speaker 1: the answer is, hands down, yes, we can do it.
Speaker 1: And so after that it's really just more kind of
Speaker 1: vanilla flavored execution. It's not to say that there's not
Speaker 1: a lot of hard parts, but uh, we have a
Speaker 1: fleet production capability. We build these mobile restaurants, upfit them
Speaker 1: ourselves as well as outside parties do it for us, uh,
Speaker 1: scaling the food production, hiring the labor. So far, we
Speaker 1: haven't bumped into anything that really stands out. It's just
Speaker 1: a bunch of little things. What about prices. It sounds
Speaker 1: like something great to do for a party, But how
Speaker 1: much does it cost to bring a Bobby flay steak
Speaker 1: to your house? Yeah, so Bobby Flays that are that's
Speaker 1: our most expensive restaurant. That's definitely a fine nine experience,
Speaker 1: and we see people doing it as a special occasion.
Speaker 1: For example, Bobby flay Stake went crazy on Valentine's Day.
Speaker 1: But we serve all the way down to sort of
Speaker 1: like you said at the beginning, Burgher's Pizza one of
Speaker 1: our restaurants. A couple of our restaurants we serve family style.
Speaker 1: It's even more affordable. We have to currently and we're
Speaker 1: gonna be offering more. But for one of his his Takorea,
Speaker 1: it's effectively a taco bar. You can it feeds a
Speaker 1: family of four to five. You pick your proteins, you know,
Speaker 1: like cardinas or chicken, your side of rice, side of beans, corn.
Speaker 1: You can add on guacamole. But that goes for fifty
Speaker 1: dollars so it's a very affordable that fifty per meal
Speaker 1: or fifty for the whole truck, fifty for the fifty
Speaker 1: for it's a family style. So yeah, wow, that's pretty amazing.
Speaker 1: We're gonna talk a bit more about it, um because
Speaker 1: I'm your more, you know, curious because I know the
Speaker 1: food industry. Sometimes the margins are so slim, so I'm
Speaker 1: curious about how that's playing out. We're gonna come back
Speaker 1: with Scott Hilton. He's chief executive officer of Wonder, former
Speaker 1: chief revenue officer of the U S e commerce business
Speaker 1: at Walmart. He's with us from her Sippany. Our conversation
Speaker 1: will continue, Tim Centivi, Carol Masser, this is Bomberg Business Week.
Speaker 1: It's official. I'm on the wait list and Wonder is
Speaker 1: gonna let me know when they are near my home.
Speaker 1: So I'm kind of looking forward to Scott. When it's
Speaker 1: gonna be He'll tell you now, all right, Scott Hilton,
Speaker 1: chief executive officer at Wonder, former chief revenue officer of
Speaker 1: US e commerce at Walmart. When will you come to
Speaker 1: Jersey City. I can't give a specific date, but it
Speaker 1: will be probably in the next couple of years, right,
Speaker 1: now we're headed north to Bergen County right now in
Speaker 1: the west field, every serving towns around there, and then
Speaker 1: we're headed north. All right, Well that's where I grew
Speaker 1: up in Bergen County. I get it. Like I was
Speaker 1: thinking about how this works. And it's probably easier right
Speaker 1: for your trucks to pull up somewhere where they can
Speaker 1: easily park. You've also got a neighborhood that's um to
Speaker 1: be fair, uh, a wealthier neighborhood where they can do this.
Speaker 1: I mean, I'm curious about the metrics and how you
Speaker 1: kind of price this all out, you know, how do
Speaker 1: you cover costs and where do you kind of you know,
Speaker 1: weird weird does profits come from? Ultimately? Is it? Is
Speaker 1: it just building it up on volume? How do you
Speaker 1: how does this play out? Now? Actually, in this business,
Speaker 1: the margins and food are really really good, very different
Speaker 1: than than say retail. When you're looking at it, say
Speaker 1: a typical restaurant, you know, they're they're looking at a
Speaker 1: food cost that's maybe in some cases, So you're starting
Speaker 1: off with really good margins. And we were verticalized. We
Speaker 1: own this whole thing. We're developing, uh, the processes for
Speaker 1: the food we prep at our own facility. So we've
Speaker 1: got a nice, healthy, juicy variable profit um and that's
Speaker 1: how we get it to work. It's very different than
Speaker 1: if you're logistics player, uh like a door Dash or
Speaker 1: uber each where you're really just trying to take a cut,
Speaker 1: or even in retail um, you know you're you're not
Speaker 1: getting as healthy and margin as you see in the
Speaker 1: food industry. And by the way, you see that in
Speaker 1: the multiples that restaurant change. The big restaurant change to
Speaker 1: get their typically three x multiple on their top line
Speaker 1: versus retailers are typicate one x. Companies like Amazon obviously
Speaker 1: get a little bit of an extra kicker there because
Speaker 1: they're the platform play, you know, high growth UM. But
Speaker 1: restaurant chains have really, really healthy margins. I'm just gonna
Speaker 1: tell you we have a restaurant row in downtown Jersey
Speaker 1: City and it's all about restaurants and there's lots of
Speaker 1: space and it would be a perfect fit tonight, Carol.
Speaker 1: I'm not trying to sell you or anything. Hey Scott, Scott,
Speaker 1: it's interesting. I wonder what the competitive mode is. What
Speaker 1: if somebody's listening in California right now and says, hey,
Speaker 1: this is a great idea. We know that Wonder is
Speaker 1: not going to be here, you know, for five ten years,
Speaker 1: I'm going to start doing this. Why won't they Why
Speaker 1: won't they succeed like you? Yeah, well, we may be
Speaker 1: in California before before ten years, but um, the reality
Speaker 1: is we've been at this for years and have spent
Speaker 1: an enormous amount of energy. Um, it's definitely not for
Speaker 1: the faint hearted, and we have to deconstruct every single
Speaker 1: dish and get them to work in this process. And
Speaker 1: it's getting them to work means having amazing, amazing food quality,
Speaker 1: but also being able to serve it at speed that
Speaker 1: supports the profitability because we definitely want to move through
Speaker 1: move food through the mobile restaurant in a fast pace
Speaker 1: we can get onto the next customer. What did you
Speaker 1: learn from your e commerce experience, whether it's Walmart or
Speaker 1: elsewhere that applies to what you're doing now or what
Speaker 1: you're doing do you kind of throw out the old
Speaker 1: rules completely? Well, look, every situation you're really have to
Speaker 1: tailor uh to what's going on and what the businesses.
Speaker 1: There's some general rules of thumb that always applies. Making
Speaker 1: sure that you first of all, have a good strategy, uh,
Speaker 1: you know, in terms of being able to execute on
Speaker 1: it and having economics workout. But after that, it's really
Speaker 1: getting the right team assembled. We've got some of the
Speaker 1: best uh team members that have stayed with us from
Speaker 1: company to company that we've been on this journey. UM,
Speaker 1: as well as making sure you've got the right structure,
Speaker 1: structures of the team's work well together. Every every team
Speaker 1: member needs to be in the right position. And that's
Speaker 1: the only way you can really scale and and grow
Speaker 1: it quickly. You have to get that foundation right first. Okay,
Speaker 1: So speaking of scaling growing quickly, we got to ask
Speaker 1: Mark Laurie sold jet dot com years ago to Walmart
Speaker 1: for three point three billion dollars. Before that, Quizzy that
Speaker 1: diapers dot Com to Amazon for five million dollars. Before that,
Speaker 1: you had a company sold to Tops for a few
Speaker 1: million bucks before the year two thousand. What's the future
Speaker 1: for wonder? Look the this this really has unlimited potential.
Speaker 1: We're not planning to sell this thing. It's got a
Speaker 1: lot of runway, a lot of upside, which is why
Speaker 1: we're able to raise that most recent round. UM. There's
Speaker 1: a there's a lot of a lot of runway left,
Speaker 1: so we're gonna build it up alright, thirty seconds. What
Speaker 1: keeps you up at night? I sleep pretty well. Come on,
Speaker 1: all right, if you had to, if you have to
Speaker 1: pick one thing, and we've only got about twenty seconds left,
Speaker 1: what would it be that you talk about? You know,
Speaker 1: you talk about workers. They're not cheap nowadays. Just quickly, No,
Speaker 1: they're not. They're not, And that's fortunate why we have
Speaker 1: the margins we pay. We pay really well. And it's
Speaker 1: a fun job that people that operate our mobile restaurants
Speaker 1: get to be, you know, run their own restaurant and
Speaker 1: serve customers. It's kind of fun. We as leaders of
Speaker 1: the company, we do a lot of ride alongs with
Speaker 1: them during the evening to see what's going on. It's
Speaker 1: it's kind of a fun role. We should do a
Speaker 1: rod along. Care on one time, we'll do a ride
Speaker 1: along with that food food included. Yeah, I was just
Speaker 1: going to say, the doggy bags must be pretty pretty impressive. Um,
Speaker 1: come back to us, Scott, let us know how things
Speaker 1: are going, and especially I'm going to wait for that
Speaker 1: email about when you guys are in Jersey City. Scott Hilton,
Speaker 1: CEO at Wonder joining us via zoom from Parsippan, and
Speaker 1: then you're gonna invite me over for dinner that night.
Speaker 1: That's going to be the finally master pizza night. Okay,
Speaker 1: a road trip