Money is pouring into ghost kitchens, which some are calling the future of restaurants. These 14 companies stand to gain the most from this hot food concept.

Karma Kitchen Eccie Gini Newton

With the pandemic increasing the amount of food delivery and hurting restaurants' bottom lines, buzzy ghost kitchens see an opportunity to grow.
The category had already attracted a lot of interest, notably from Uber co-founder and former-CEO Travis Kalanick, who launched CloudKitchens in 2016.
We compiled 14 of the biggest players in the ghost kitchen world to show the international scope of the budding space.
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The pandemic has closed thousands of restaurants, many for good, while food delivery volume is increasing substantially. Much of the country reopening indoor dining, but Opentable is reporting that the amount of seated diners continues to substantially underperform last year.

Ghost kitchens, a buzzy class of startups, were already betting that delivery would grow in market share, attracting founders including billionaire Uber ex-CEO Travis Kalanick, but the rapid increase in delivery demand has accelerated their growth.

These companies operate a kitchen that hosts multiple restaurants or menus, from which they only do delivery orders (or sometimes pick up). Some run their own food brands, while others partner with local chefs or established delivery brands.

While American startup hotbeds like Silicon Valley and New York have seen multiple ghost kitchen startups, this trend is worldwide, with Dubai, India, and Western Europe emerging as other areas that have spawned multiple startups.

"Every single restaurant globally became a ghost kitchen overnight," Corey Manicone, CEO and cofounder of Zuul Kitchens, told Business Insider. He said that the pandemic has accelerated the concept by three to five years, but that there's a lot of growth ahead.

"We're at the same place as e-commerce in the early 2000s," he said.

Money continues to flow into the space: both Zuul and hotel-focused ghost kitchen Butler Hospitality raised money in July, $9 million and $15 million respectively. Karma Kitchen, a UK based kitchen, recently raised $318 million as well.

In a time of economic contraction, the model makes a lot of sense for restauranteurs. Real estate and labor costs can be pooled across multiple restaurants, lowering the amount of square footage and the number of employees a restaurant needs. Less overhead, with the same amount of income.

The pandemic's impact on retail space, including restaurant space, has also been a boon for the industry. Firms convert restaurant space, underutilized retail space, and occasionally industrial space into ghost kitchens. Two of those three categories, retail and restaurants, are having an outsized negative effect from the pandemic, which leads to a glut of supply for ghost kitchens.

While real-estate firms may not have originally planned to bring ghost kitchens into their space, the bottoming out of demand from traditional tenants has opened many up to the business.

"A lot of these development companies, larger landholders, and real-estate firms are taking a forward-looking, reset view of what is the best way to optimize their holdings for the future," Jim Collins, founder and CEO of Kitchen United, told Business Insider.

We've created a list of 14 of the hottest startups in the space, highlighting where they've received money and what's different about their concept.

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Butler Hospitality

Money raised: $20.2 million

Investors: Mousse Partners, The Kraft Group, Entrepreneurs Roundtable Accelerator, &vest, Scopus Ventures, Loeb.nyc

Cities / Countries it operates in: NYC, expanding to Chicago, Miami, Washington DC

What it does:

Butler Hospitality, founded in 2015, puts a twist on the classic ghost kitchen model, delivering room service at multiple hotels across New York.

What makes it different: According to founder and CEO Tim Gjonbalic, hotels lose a lot of money on food and room service, but need it in order to bag high-paying business travel clients and conference and event clients.

While hotels have been hit hard, Gjonbalic believes that this will actually be a boon to his business, as they'll look to cut costs, focusing on food and beverage first.

"The only way for our clients to get contracts for the National Guard at the Javitt Center or for visiting nurses was to make sure there's food and beverage for them," Gjonbalic told Business Insider.

CloudKitchens

Money raised: $400 million

Investors: Saudi Arabia's sovereign wealth fund

Cities / Countries it operates in: US, China, India, and Europe

What it does: CloudKitchens was founded in 2016 by former Uber CEO and co-founder Travis Kalanick. The company is quite secretive and doesn't advertise locations or conduct interviews.

The company operates its own brands, with names like " B*tch Don't Grill My Cheese," and has locations in the US, China, India, and Europe.

What makes it different: The most major difference is Travis Kalanick and the Saudi Arabian sovereign wealth fund. Saudi Arabia was a long time backer of Uber.

The Wall Street Journal has reported that the company has made roughly 10 acquisitions of ghost kitchen competitors around the world, and has bought over 100 properties globally, but didn't report actual locations and asset types.

Deliveroo

Money raised: $1.5 billion

Investors: Amazon, Fidelity Management and Research Company, T. Rowe Price, Accel, Index Ventures and other

Cities / Countries it operates in: UK

What it does: Deliveroo is one of the largest food delivery services in the UK. The company has also been dipping its toes into ghost kitchens for a few years, setting up shop in converted shipping containers in parking lots.

What makes it different: Deliveroo isn't the only delivery service to try the ghost kitchen business. Uber Eats launched a location in Paris in 2018, but then closed it at the end of 2019.

Karma Kitchen

Money raised: $318 million

Investors: Vengrove Asset Management

Cities / Countries it operates in: London

What it does: Karma Kitchen was founded in 2018 by two sisters, Eccie and Gini Newton, and earlier this month raised a massive $318 million series A funding round from industrial-focused real estate firm Vengrove Asset Management.

The company works with other brands, that can rent out space for as little as $53 a shift.

As of now, they have one location in London, but the company is expected to open two more locations in the city and plans to expand across Europe.

What makes it different: While Karma Kitchen seems to follow a pretty traditional ghost kitchen model at the moment, their partnership with Vengrove implies that the company might continue to dig into industrial space.

Keatz

Money raised: Roughly $23 million

Investors: Atlantic Food Lab, U-Start, K Fund, Project A Ventures, JME Ventures, Marco Valta

Cities / Countries it operates in: Berlin, Amsterdam, Madrid, Barcelona, and Munich

What it does: Keatz was founded in Berlin in 2016 and has now grown to ten different cloud kitchens.

The company develops its own brands and menus, and has focused on providing food that can easily be delivered.

What makes it different: Keatz's range of locations across European cities gives it access to a wide range of markets.

Kitchen United

Money raised: $50 million

Investors: GV (Google Ventures), RXR Realty, Fidelity, DivcoWest, G Squared

Cities / Countries it operates in: Chicago, Pasadena, Scottsdale, and Austin, expanding to locations like New York City and Los Angeles

What it does: Jim Collins, the founder of Kitchen United, worked in tech until he decided to open up his own restaurant in 2014.

"I thought I would prematurely age less if I bought and ran my own restaurant," Collins told Business Insider. The stress of running a kitchen changed that dream for him very quickly.

By 2017, he founded Kitchen United, after seeing the challenges that his restaurant had in the face of increasing delivery demand.

The company started with one location in Pasadena in 2017, and has now grown to four locations. Kitchen United partners with other brands, instead of creating its own.

What makes it different: The company's funders include RXR Realty, a forward-thinking real estate owner and operator, and GV, Google's venture arm.

This combination gives the company access to leaders in both real estate and tech, a big advantage in the ghost kitchen world.

Kitopi

Money raised: $89 Million

Investors: BECO Capital, VentureSouq, Crescent Enterprises, MSA Capital, Reshape, and more

Cities / Countries it operates in: Dubai, Abu Dhabi, London, Kuwait, Riyadh, and New York

What it does: Kitopi, founded in Dubai in 2018, has grown substantially across the Middle East, and launched in New York in late 2019. The company announced this March that it would partner with Nathan's Famous Hot Dogs to deliver across New York City.

The company works with restaurants to deliver food out of their ghost kitchens, using Kitopi's own chefs to prepare the food.

What makes it different: The company plans to grow rapidly. When the company announced its fundraising round in February of this year, it also announced that it planned to open 50 locations in the US and 100 globally by the end of 2020.

Rebel Foods

Money raised: $342.3 million

Investors: Sequoia Capital, Lightbox, Coatue Management, Goldman Sachs and more

Cities / Countries it operates in: 35 cities across India and Dubai

What it does: Faasos, an Indian company founded in 2011, began life as a fast-food restaurant that focused on Indian food specifically. The company scored an early investment from Silicon Valley power players Sequoia Capital, and eventually renamed itself to Rebel Foods.

The company switched from traditional restaurants to delivery-only ghost kitchens, spinning off Faasos as one brand under the Rebel Foods banner in 2015.

What makes it different: Rebel Foods now has more than 320 ghost kitchens across 35 cities in India, as well as in Dubai, and is the largest cloud kitchen operator in the world.

REEF Technology

Money raised: Undisclosed

Investors: Softbank

Cities / Countries it operates in: Mainly the US and Canada, but expanding to Europe

What it does: REEF Technology is the company's largest parking lot operator, but it doesn't picture itself as a parking company, instead using parking to "transform underutilized urban spaces into neighborhood hubs that connect people to locally curated goods, services, and experiences,' according to its website.

The company does that by providing space for light logistics companies, like its partnership with Bond, and by creating their own ghost kitchens, or in REEF parlance, REEF Neighborhood Kitchens.

What makes it different: REEF, founded in 2013 as ParkJockey, now owns 4,500 parking lots, making it able to rapidly scale up according to demand. The company partners with local restauranteurs to launch in new locations, instead of operating its own brands.

Star Kitchens

Money raised: N/A

Investors: N/A

Cities / Countries it operates in: China

What it does: Star Kitchens is quite different from others on this list, as it is not a stand-alone company, but instead a partnership between Starbucks and the Alibaba owned grocery store Freshippo.

Customers can order online, and then within 15 minutes, pick up their Starbucks order in the store. At the moment it is operational in three Freshippo stores, but there are plans to expand to other locations.

What makes it different: Star Kitchens is quite different from others on this list, as it is not a stand-alone company, but instead a partnership between Starbucks and the Alibaba owned grocery store Freshippo.

Alibaba launched Freshippo in 2016, with the intention of launching a mobile-first grocery store. The brand now includes many different retail concepts, from convenience stores to the Star Kitchens kiosks.

Sweetheart Kitchen

Money raised: $23.5 million

Investors: Undisclosed

Cities / Countries it operates in: Dubai and Kuwait, and the company is planning to add more locations across Saudi Arabia.

What it does: Sweetheart Kitchen was founded in Dubai in 2019 by Peter Schatzberg, who had previously founded pioneering ghost kitchen company Green Summit Group in 2012.

The company has created 30 of its own food brands.

What makes it different: Schatzberg's prior experience is extremely rare in this new industry. Green Summit Group company had early success but eventually ran out of money, which could teach Schatzberg major lessons about how to run a sustainable ghost kitchen business.

Swiggy Access

Money raised: $1.6 billion

Investors: Prosus Ventures, DST Global, Tencent, Meituan-Dianping and others

Cities / Countries it operates in: India

What it does: Swiggy is India's largest food delivery service. After launching in August of 2014, it has raised $1.6 billion in funding from major venture firms like Prosus Ventures, DST global, Bessemer Venture Partners.

The company launched its ghost kitchen brand, Swiggy Access in 2017, and at the end of 2019, the company had 8,000 people working for Swiggy Access, with its eyes on 7,000 more employees by the end of 2020. The company claimed to have 1,000 ghost kitchens across the country.

What makes it different: Swiggy's built-in customer base is a major boom to the business.

However, it was hit hard by the pandemic, with two rounds of roughly 1,000 person layoffs, one of which hit the cloud kitchens almost exclusively. TechCrunch got ahold of an internal email where CEO Sriharsha Majety said that the company had shut down many of its kitchens as a result of the virus, many of them permanently.

Taster

Money raised: $13.1 million

Investors: LocalGlobe, Marc Menase, Heartcore Capital, Global Founders Capital, Founders Future, Battery Ventures, Eduardo Ronzano, Kima Ventures

Cities / Countries it operates in: UK, France, and Spain

What it does: Taster, founded in 2017, operates its own food brands across Europe.

What makes it different: The company was founded by Anton Soulier, a former Deliveroo executive.

It doesn't handle its own real estate, and partners with companies like CloudKitchens to find locations.

Zuul Kitchens

Money raised: $9 million

Investors: Undisclosed

Cities / Countries it operates in: New York City

What it does: Zuul Kitchens, a New York City-based ghost kitchen operator, was founded in 2018 by Corey Manicone, the former director of sales for white-label delivery operator Relay.

The company acquired food-delivery tech platform Ontray earlier this year.

What makes it different: The company has partnered with brands like salad-masters Sweetgreen and Asian fast-casual Junzi in its NYC ghost kitchens. By working with established brands, this should lower the marketing burden on the company.