How to Look for Investors to Grow Your Ghost Kitchen

If you're looking to create a ghost kitchen, there's plenty of work to tend to — but the results can be seriously profitable. Once you've come up with a brilliant concept with innovative marketing ideas and financial projections — you're ready to seek funding. In today's increasingly connected digital marketplace, there are more opportunities than ever to secure investment.

That said, you'll only attract the best investors if your business plan is water-tight and you've accounted for a variety of potential outcomes. Read on to find out more about how to secure funding for your ghost kitchen startup.

How Do I Start an Online Restaurant?

The ghost kitchen boom began before COVID-19 struck, but shelter-in-place orders have skyrocketed demand for food delivery services to astronomical levels. In 2018, consumers in the U.S. spent $10.2 billion on ordering food — and some estimates state that this doubled, or even tripled, in 2020.

Starting a ghost kitchen is easier than opening a traditional restaurant with front of house service, but it still comes with an array of challenges. With so much competition, you need to make sure that your team perfects the two cornerstones of online food delivery — quality and speed of service.

With no fancy menus to print, furniture to ponder over or unpredictable front of house staff to train, you're free to focus on the bottom line. The main focual points for setting up a ghost kitchen should be:

  • Taste, temperature, packaging and balancing cost with taste are the most important aspects of quality
  • Preparation and delivery time are critical if you want to serve enough meals each hour to make a profit
  • Choose the right location
  • Decide between in-house delivery or listing your business on third-party apps — or all of the above!
  • Factor delivery costs into pricing
  • Strictly adhere to health and safety guidance
  • Be experimental and original to stand out and find a USP
  • Hire staff diligently
  • Manage inventory with military precision
  • Ensure that you have a clear brand identity and marketing plan
  • Harness the power of data

Obtaining Funding for Ghost Kitchen Startups

Now you've got the basics covered, it's time to find investors to bring your vision to life. Depending on the angle you choose, there'll be plenty of hoops to jump through to prove that you've got what it takes.

Discover the main types of investors you should consider approaching to get the cash for starting a dark kitchen.

Venture Capital Investment

Venture capital is a type of financing that investors give to small businesses and startups that have the potential for long-term growth. Individuals or organizations pool money from financial institutions — usually in return for equity in the business. Bear in mind that this means they'll likely have a say in certain aspects of operations.

Angel Investors

Angel investors are individuals with a high net worth who use their own money to invest in startups and small businesses in return for equity. While they're often friends or family members, it's possible to shop for angel investors online or at events.

Blogging

Blogging is an excellent way to secure funding because it provides a unique insight into your methods and processes. Investors want to be as close to certain as possible that the company they put up funds for will be fruitful. Showcasing your story and diligent business practices along the way is a great way to show people what you're capable of.

Social Media

Social media is a profoundly powerful tool for business owners because it provides unparalleled access to other people. You can follow investors that interest you, get a feel for who they are and start building a relationship with them remotely.

Crowdfunding

Crowdfunding has emerged in the last decade as a serious way for business owners to raise capital. It often takes a lot of work because you need to convince as many people as possible to invest in your ghost kitchen. The beauty is that they don't have to be rich or have a stake in your company.

Which Investors Are Active in the Ghost Kitchen Space?

  • Andreessen Horowitz: With a keen eye on the entrepreneurial spirit of the type of individuals who are starting up ghost kitchens, this investor is an ex-Uber exec with a clear vision of growth in the industry.
  • Sequoia Capital: Sequoia Capital is one of the investors that have made the most contribution to the restaurant tech industry.
  • Y Combinator: Y Combinator is a startup accelerator that's helped launch over 200 companies, including DoorDash, Coinbase, Dropbox, Reddit and Airbnb.

Top Ghost Kitchen Trends for 2021

The food industry is at the mercy of ever-changing trends, so it's vital that you know how to discern the difference between a fad and a lasting change. Some of the most important emerging trends in the restaurant delivery industry include:

  • Digitally integrated curbside pickup mitigates the costs associated with delivery for the customer and your business and means locals can get their dinners even faster.
  • Minimum wage is increasing throughout the nation, so savvy restaurant operators will need to find ways to offset these costs without compromising quality.
  • Big brands are getting increasingly interested in the ghost kitchen concept, so beware of competition in the locale you choose to set up in.
  • Sustainable packaging is a must in an increasingly environmentally-conscious world — but it doesn't come cheap, and you can't compromise on how well it keeps food hot and presentable.

Build a Ghost Kitchen With Cuboh

Cuboh integrates your online ordering apps so you can manage every order from one device and streamline operations to increase your ordering capacity. If you're ready to discover its potential, book a demo today.

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