The pandemic ushered in a new area for technology use within restaurants with the first iteration focused on contactless payments and digital ordering. The next wave of technology companies is focused on improving the restaurant industry operationally. PreciTaste is an AI vision platform that’s focused on optimizing the food service in quick-service restaurants and fast-casual restaurants. The company improves the customer experience by increasing the efficiency of restaurants all while cutting down on waste. Using a number of cameras positioned in and outside establishments, the company’s machine learning software is able to provide predictive assessment for demand-based forecasting, order forecasts, and inventory management. Insights are available on a cloud-based dashboard to allow operators to manage several locations as well as the ordering experience. By integrating on-site data layered with external data like traffic and weather, PreciTaste can provide demand forecasts that are 95% accurate for up to two weeks in advance. Customers using the solution have been able to successfully increase EBITDA by 100% by accurately ordering, staffing, and reducing food waste. AlleyWatch caught up with PreciTaste VP of Operations Hauke Feddersen to learn more about the business, the company’s strategic plans, latest round of funding, and much, much more… Who were your investors and how much did you raise? PreciTaste’s $24M Series A is led by existing investor Melitas Ventures, a fund that invests in innovative early-stage food and beverage companies, and Cleveland Avenue, a mission-driven investor in food, beverage, and technology companies. Additional investors include Enlightened Hospitality Investments (EHI), the growth equity fund cofounded by Danny Meyer, the Founder of Union Square Hospitality Group and Shake Shack, and Monogram Capital Partners, a leading consumer-focused growth fund with investments including Chewy.com, Oatly, and Foxtrot. Tell us about the product or service that PreciTaste offers. PreciTaste is a Vision AI platform for operational optimization in foodservice applications like quick-service restaurants (QSR) and retail food preparation. Developed to maximize efficiency, enhance customer experience, and reduce food waste, PreciTaste’s mission is to become the standard for digital food AI management in fast casual and QSR kitchens. What inspired the start of PreciTaste? PreciTaste’s first product was the Virtual Baker®, which is now managing in-store baking processes in Europe’s largest grocery retailer. Our growth funding came with the foodservice industry’s heightened digital focus in QSRs and fast casual restaurants spurred by the pandemic and its increased digital focus since. This Series A round will help fund the continued expansion of our food service systems across sectors. How is PreciTaste different? The largest food chains apply PreciTaste to combat the industry’s labor, quality, and sustainability challenges. With 1,500+ food AI systems deployed since 2020, PreciTaste has the infrastructure to deliver when it comes to complete digital food AI management and navigating the complexities of each kitchen. We also have real-world experience in bringing sensing and computing into the steamiest and busiest kitchens, which has led us to build an infrastructure that can effectively learn and manage each individual food service operation and is highly scalable–something that no other technology in the food AI space has. What market does PreciTaste target and how big is it? We target top fast casual and quick-service restaurant chains. What’s your business model? We have a platform that can adapt to each operation and is highly scalable. Flexible software applications enable use cases like demand-based cooking and ingredient preparation, real-time task management, or order accuracy, which are specific to the individual needs of our customers. How are you preparing for a potential recession? The pandemic has increased the need for digital optimization in food chains. While front-of-the-house order systems have been optimized, back-of-the-house systems still remain behind the curve. With or without a potential recession, challenges like labor shortages and rising food prices will continue to put increased pressure on the need to automate processes.
What was the funding process like? We were amazed by the support and great advice we received from all VCs. Three out of four of our investors came through recommendations from other funds. Never having raised money before, I had envisioned the industry to be a pool full of sharks and was pleasantly surprised that most of the early, invaluable support we received came from funds that hadn’t invested in us. What are the biggest challenges that you faced while raising capital? The greatest challenge was being a trailblazer in terms of our unique service offering. We could immediately tell if a VC we pitched “got” it or did not see AI management as a solution to the industry’s most prominent problems. There was so much interest from those who understood our value that we doubled our initial funding goal in order to assemble the dream team of investors to support our growth. What factors about your business led your investors to write the check? They’ve seen PreciTaste’s ability to drive sales and profit by solving the most critical kitchen management problems, and that our technology can pay for itself through food waste savings alone and is highly scalable. With this, they believe that PreciTaste is the advantage every quick-service kitchen needs.
What are the milestones you plan to achieve in the next six months? We’ve expanded to over 100 employees across Munich, Mumbai, and U.S. locations, with plans to add another 25 team members in the next quarter. What advice can you offer companies in New York that do not have a fresh injection of capital in the bank? You are in the best place in the world to raise capital. Be out there and speak with everybody – even if you know you don’t fit their bracket. Every conversation hones your pitch and product. Therefore, listen with open ears for all feedback. Your main target is obviously funding. But a friendly recommendation can be just as valuable. Where do you see the company going now over the near term? With $24 million in Series A growth funding, PreciTaste is fast-tracking its proprietary Vision AI deployments to continue roll-out expansion across food chains. Our mission is to be the standard for digital food AI management across sectors while fostering sustainability. What’s your favorite outdoor dining restaurant in NYC? Before the pandemic, we rented a soccer field on the East River each week. Right next door is the Fornino Pier 6. Excellent pizza and an unbeatable view of the greatest city in the world.