Sam Nazarian has scooped up another defunct delivery business.
The CEO of digital restaurant company C3 and hotel and nightclub group SBE said Thursday he has acquired some of the assets and IP of former ghost kitchen operator Kitchen United after the company shut down its physical locations late last year to focus solely on software.
Nazarian will use Kitchen United’s kitchens and food halls as a foundation for a new digital restaurant company called Everybody Eats. The group will include Nazarian’s digital restaurant holdings, C3 and Nextbite, the latter of which he acquired in June after it laid off most of its staff.
Financial terms of the Kitchen United deal were not disclosed. It solidifies Nazarian as one of the biggest players in virtual brands, or restaurant concepts that are produced and sold by other operators for online delivery or pickup.
Founded in 2017, Kitchen United began as a shared-kitchen delivery business and later transitioned into digitally focused food halls, some of which were in Kroger grocery stores. It had about 25 outlets nationwide as of September.
A press release from Nazarian did not indicate how many of those locations he acquired, nor what he planned to do with them. But they could potentially be used as hubs for the dozens of brands owned by C3 and Nextbite, including Sam’s Crispy Chicken and Krispy Rice for C3 and Crave Burger and Grilled Cheese Society for Nextbite.
Nazarian said in a statement that he had admired Kitchen United and Nextbite for years as they worked to “change the virtual culinary industry.”
“These companies have had incredible ideas and unbelievable instincts but just not enough capital to ultimately disrupt the market,” he said in a statement.
That is what Nazarian hopes to do with Everybody Eats, which includes restaurant brands, real estate and proprietary technology. Existing restaurants can license Everybody Eats brands as an additional revenue stream and use its technology, specifically a mobile app called Citizens Go, to sell the food online.
Everybody Eats is also looking to put its brands in grocery stores, convenience stores, schools and hotels, both in the form of fresh meals and packaged goods. It was unclear whether the group will also operate its own sites, such as C3’s Citizens Food Halls in New York City and Atlanta. The press release described Everybody Eats as a “100% asset light IP and premium QSR and CPG brand company.”
Helping to guide the new entity is newly hired COO Geoff Madding, the former chief growth officer of Nextbite.
“I am incredibly excited to join the Everybody Eats team, continuing the journey I began during my time at Nextbite, to disrupt, innovate, and ultimately, help evolve the culinary industry,” Madding said in a statement.
The virtual brand model is far from a surefire success, as evidenced by the multiple failed companies that Nazarian has accumulated. Many restaurants, such as Red Robin and Chili’s, have moved away from virtual brands in recent years to focus more on their core businesses. And digital-only concepts face increasing competition from traditional brick-and-mortars that are themselves looking to do more business online.
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