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$400+ million ex-pizza robot company Zume shuts down

Zume sold its robot pizza business in 2020 to pivot toward sustainable packaging and Picnic laid off employees earlier this year; what’s happening to pizza robots?

Zume — once the preeminent name in pizza technology that made headlines and millions in startup funding in 2017 — has shut down more than three years after pivoting away from robot technology to sustainable packaging development. The SoftBank-funded company is allegedly insolvent and chose to liquidate its assets rather than declare bankruptcy, according to tech news publication, The Information.

Zume was founded in 2015 with the goal of automating the pizza industry and attracted the attention of investors, most notably its lead investor SoftBank that poured approximately $375 million into the tech startup. According to Crunchbase, Zume raised $423 million in eight funding rounds — though the exact number remains disputed — and was considered a unicorn startup with a valuation of more than $1 billion by 2018.

After encountering some operational speedbumps, Zume CEO Alex Garden announced in 2019 that the company had purchased sustainable packaging company, Pivot Packaging, and had plans to build a 70,000-square-foot manufacturing plant in Southern California to launch Zume Packaging.

“It’s about taking plastic out of landfills, but it’s also about finding new uses for what are also agricultural waste products,” Garden told Nation’s Restaurant News in a 2019 interview.

By 2020, Zume had sold its pizza technology business, laid off a significant portion of its staff, and was focusing entirely on the sustainable packaging business.

Although Zume has not been associated with pizza technology in a long time, the company was the first of many tech startups that have permeated the pizza industry over the past several years. As pizza became the one of the most prominent foodservice segments to delve into robot technology and kitchen automation, names like Piestro, Picnic Works, and Stellar Pizza began attracting attention and startup funding.

But Zume is not the only company to struggle with long-term success in this area. In February of this year, Picnic Works — best known for its pizza robots that can auto-press dough and add sauces, cheese, and toppings — laid off an unspecific percentage of its staff due to the current macroeconomic challenges, former CEO Clayton Wood said in a LinkedIn post. Shortly after, Wood himself parted ways with the company and is now serving as an advisor and venture partner in the foodservice technology space. Wood told Nation’s Restaurant News that right now, it’s a tough time to be in the food tech space, despite the seemingly revolving door of food tech startup funding rounds.

“The food tech space is inherently hard,” he said. “It is new and not well-understood… There is no natural constituency of investors clustered around that space. A lot of the larger, deeper pocketed funds have either ruled out hardware or are very reluctant to invest in hardware. So, it makes it hard to raise a growth round in a brand-new industry.”

Wood said that unlike opening a burger restaurant or taco chain, there is “no well-worn path” for food automation. The food robot space in particular is so brand-new that customers (operators) don’t know yet what they want which makes it difficult to know what will stick and be lucrative for investors in the long-run.

Despite these murky waters, Wood is optimistic about the future of the foodservice automation industry, particularly when it comes to pizza robots.

“Zume was so prominent, and they got famous because they raised a lot of money and their idea was innovative and captured everyone’s imagination,” Wood said. “There are all these people saying that pizza robots could never work because they can’t replace the old-world pizzamaker, which is nonsense. It’s all based on the fact that Zume failed as a pizza robot company, something it had not been for years.”

Zume did not respond to requests for comment in time for publication of this story.

Contact Joanna at [email protected]

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