Lanch bags $27M for a social media-skewed take on fast food
Summary
E-commerce startups built around food continue to gobble up funding as investors look for sticky consumer concepts that can scale without breaking the bank. The startup has raised about $34 million to date (including this seed round in 2023) so on normal Series A multiples, that likely puts it at between $100 million and $150 million.In an interview, Nono Konopka the CEO who co-founded the company with Dominic Kluge, Jonas Meynert, and Kevin Kock said the plan is to use the funding to continue expanding in Germany before moving to more markets.So far Lanch has developed three brands: Loco Chicken and Happy Slice Pizza, as well its first packaged food, Happy Chips (potato chips).Lanch will use the game-plan it has devised mixing data it sources from social media and other online activity to figure out gaps in the market; plus tapping creators/influencers to launch and endorse the food products to add to that list, too.So far and putting aside the fact that all of this is not particularly healthy that formula has served the startup well. It said that since it launched commercially a year and a half ago, it has expanded to 350 ghost kitchens making its hot food Loco Chicken being especially popular which in turn are sold in a growing number of franchise stores, but primarily through food delivery platforms such as Lieferando and Walt.Partnering with personalities big in the German social media landscape, Lanch has also had a few viral wins to boost its profile. We are really focused on now building the next Raising Canes or Chick-fil-A.He also said that the potato chips are now being sold in 10,000+ supermarkets, adding that it will be announcing another snack food alongside that soon.Lanchs rise underscores the emergence of a new class of startup (and tech company) that is leaning on the all-pervasive presence of social media, and the data that it brings with it, to build out new kinds of products.Konopka said that he considers Lanch to be a technology company due to how it uses data.Its incredibly hard to figure out where to open a restaurant, but we have 350 delivery locations [its ghost kitchens], and they give us a mind-blowing amount of data, he said. On top of that there is the social-media aspect, working on partnerships with influencers and users to help promote their products, and using these attention-based platforms to understand what people are interested in eating at a far cheaper cost than is involved in running physical trials, or big marketing campaigns.Still, food-based tech startups have given the industry and investors a lot of indigestion over the years.The market for fast-delivery startups and online grocery has wobbled and collapsed, wiping out hundreds of millions of dollars of investment.