Marc Lore plans US expansion of Wonder Group’s food delivery business

A Wonder van parked outside a customer’s home. Each Wonder vehicle has a chef who prepares meals before delivering them to the front door.

Source: Marvel

Whether Americans are looking to order a quick bite at a local fast food chain or want to feel like they’re eating at a five-star restaurant from the comfort of their living room, Marc Lore wants to redefine dining at home. .

The contractor finally makes public his latest project eCommerce: a company that is both a food truck and a phantom kitchen coupled with a DoorDash rival and Uber Eats.

The former head of e-commerce operations of Walmart in the United States partnered with Scott Hilton, who has served as director of revenue of US digital arm of Walmart to launch Wonder Group, wrote in a Lore article on LinkedIn on Tuesday. Lore is the CEO of Wonder Group, while Hilton is CEO of Wonder, a division within the holding company that oversees a fleet of trucks with mini-kitchens inside.

CNBC reported on Lore and Hilton’s involvement with Wonder in May, when the company was operating in stealth mode in the affluent town of Westfield, New Jersey. The duo have since launched a delivery service for local restaurants, called Envoy, which is very similar to platforms such as Grubhub and Seamless. Both companies operate side by side within Wonder Group.

“It really is a one-stop-shop for all ready meals,” Lore said in a Zoom interview. “And we think there’s a real chance of having a win-win in this market. … You don’t really need another app.”

Next year, Lore and Hilton plan to bring Wonder and Envoy to Westchester County, New York, parts of Connecticut, northern and central New Jersey, and part of New York. Their ultimate goal is to expand nationwide, targeting densely populated communities. Lore said the company plans to have 1,200 to 1,300 mobile kitchens in the northeast next year, and to triple that number by 2023. It has around 60 mobile kitchens in operation as of today.

“Meals on demand”

Hilton’s vision for Wonder is to give American homes access to freshly prepared meals from top chefs in every region of the country.

The idea is that someone living in upstate New York could order the famous cheesesteak sandwich Fred’s Meat and Bread, based in Atlanta. Or someone from New Jersey could order a wood-fired Margherita pizza from Los Angeles-based Nancy Silverton’s Pizzeria Mozza. Wonder is partnering with select restaurant owners, including Bobby Flay and Jonathan Waxman, for exclusive rights to recreate items on their menus.

“Wonder, in short, is a food and technology company,” Hilton said in an interview. “It’s a home-cooked meal on demand.”

Wonder also wants customers to get their food when it’s really hot. Thus, he completes the final preparation of the meals inside the vans which have been equipped with kitchen appliances, once the driver arrives at his destination. Each Wonder Van has a trained chef on board and is dedicated to a single restaurant.

Ingredients are prepared and packaged in a large central kitchen before being distributed to smaller kitchen centers accessible throughout the week by Wonder’s vehicles.

So far, business at markets where Wonder has served food has been driven largely by word of mouth, Hilton said. Wonder’s vans, adorned with the company logo on the side, serve as traveling billboards of sorts, he said.

Wonder currently works with 17 restaurants, serving approximately 17,000 households in New Jersey. As more and more dining options are added to the platform, a user is more likely to come back and order again a dinner at Wonder said Hilton. The business also plans to expand soon to serve breakfast and lunch. Recently, it launched a dessert selection and added cocktails after acquiring a liquor license.

Wonder and Envoy are coming out of stealth mode at a time when more Americans have adapted to eating at home during the pandemic. Some consumers preferred to cook their own meals, while others turned to takeout and delivery from their favorite restaurants. Experts predict some of these behaviors will persist, even as Covid fears ease.

Admittedly, food delivery is a tough business to run and make money. DoorDash, for example, has seen sales increase in recent months, but it remains unprofitable. His net loss more than doubled in the three months ended September 30. And ride-sharing company Uber has long been losing money on its Eats division.

Envoy, notably, uses its own fleet of cars and drivers separate from Wonder.

According to Hilton, the advantage of Wonder compared to other platforms food delivery is that it serves as the home of a defined area in order to perform several deliveries in one trip so that a driver made no “empty” journeys. And because the company prepares food on a large scale in a central kitchen, this process helps keep food costs lower than in a restaurant, he added.

For a Wonder Van to break even for the evening, it needs to make about $100 in sales per hour, according to Lore and Hilton.

A page from the Netflix playbook

Lore, who co-founded Jet.com before selling it to Walmart, said Wonder’s strategy was a bit like pulling a page from Netflix content playbook.

“We want to lock down all the best first-party content,” he explained. “Every well-known chef – every restaurant that’s great – we basically want to lock it down and have it exclusively on Wonder.”

“We know there will be competitors one day, but we’ll have all the best content locked down ahead of time,” Lore said.

Wonder Group recently raised venture capital from investors including NEA, Accel, GV, General Catalyst and Bain Capital Ventures, Lore said. The company declined to provide total funding figures. However, a person familiar with the funding said it has raised over $500 million to date.

Since leaving Walmart earlier this year, Lore is now co-owner – with former baseball star Alex Rodriguez – Minnesota Timberwolves of the NBA. The company’s venture capital duo, People Vision Capital, also seeks to other paris on digital commerce. Meanwhile, Lore working on the construction of a supposedly utopian city of the future, called Telosa.

But Lore said he devoted all of his “professional” work time to Wonder Group.

“I feel like I was shot by a cannon. … I just had all these ideas coming in,” Lore said of his time since leaving the big-box giant. “[Wonder] really has the opportunity to change the way we think about food – how we eat.”