Colombia-based RobinFood — Latin America’s fastest-growing chain of “cloud” restaurants — credits proprietary technology, the explosive growth of FinTechs and pandemic-led lifestyle changes as the secrets of its success. Add in ghost virtual-ordering kiosks and physical locations and Luis Vega, RobinFood co-founder and COO, expects RobinFood to become Latin America’s largest player by restaurant count by 2024.
“We are a tech company that sells food,” Vega said. But he said that since the region’s average monthly income is less than $400, “we knew if we wanted to go massive, we would have to go downscale.”
Despite low average incomes, Latin America offers a huge overall market size and growth potential. The region is home to nearly half a billion people and already served by virtually every quick-service restaurant (QSR) chain imaginable — as well as an array of mom-and-pop options, seemingly on every seemingly corner.
Even so, Vega said that when it comes to ordering food, the masses are underserved.
“The average income level of the people here doesn’t allow them to go to the Kentucky Fried Chickens and the McDonald’s on a daily basis. They just can’t afford it,” he said. “What we’re trying to do is tap into this huge population bracket.”
Breaking Latin Americans’ Love Of Paying Cash
To capture the market’s low end, RobinFood has created a fleet of cloud restaurants across giant cities in Colombia, Brazil and Mexico. These serve customers meals via contactless ordering kiosks, takeout or delivery.
“It’s very convenient, but also very, very disruptive,” Vega said. “You can get your food in four minutes for a couple of dollars.”
But because speed and efficiency are critical, RobinFood has embraced of modern digital payments technology in a region where 80 percent of food is paid for in cash. Vega said flexibility around payments is a big part of RobinFood’s growth and value proposition.
“What we’re seeing is a shift toward more credit cards and debit cards, but also an explosion of the FinTech companies,” he said. “The payments landscape is changing very fast in Latin America, and it’s not being driven by the traditional banks, but rather by the FinTech companies.”
But as much as FinTechs and RobinFood both want to use the chain’s cloud restaurants as testing grounds for new digital-transaction offerings, Vega said his company is committed to being “payment agnostic.” It wants to allow people to order and pay however they’re most comfortable, whether that means using QR codes or facial recognition.
Behind the scenes, RobinFood is also looking at using technology such as convolutional neural networks and artificial intelligence as quality control measures for each dish. Vega said that involves taking an image of the dish, and if it gets rejected for whatever reason, you can trace it back and know exactly who prepared it.
Try It, You’ll Like It
Like most technological changes, cloud restaurants would intrinsically seem to be a more natural fit for younger, tech-savvy consumers.
However, Vega likes to cite the experience of his 80-year-old mother, who was able to navigate RobinFood’s process and quickly become comfortable with new concepts like not having a cashier.
The pandemic has only helped drive such adoption. “I think COVID has dramatically changed business everywhere, and Latin America is no exception to that,” Vega said.
$16 Million In New Funding
RobinFood this month raised $16 million in debt funding from MGM Sustainable Energy Fund II.
Vega said the company planned to invest that money into expanding operations and “winning” in Colombia, Mexico and Brazil. At the same time, the company will also continue to invest in new technology, as well as hiring additional people to strengthen its development team.
“Those three things — infrastructure, people, and technology — are going to drive our business forward [and] will allow us to win in those three markets over the course of the next two years,” he said.
And while some have questioned the timing of trying to grow a food-based startup during a pandemic, Vega is undeterred.
“I always tell [critics]: ‘We’re very confident about the future,'” he said. “The spirit of the people in Latin America will prevail.”