a16z Podcast - a16z Podcast: The Data Science of Food and Taste

Episode Date: November 25, 2015

The best cooks know cooking a meal is all about having a plan (and a back-up plan if things go south); get the cooking out of the way, and then you can enjoy your family and friends -- the most important part. But now try doing it for thousands. How can one company be the de facto sous chef for so many? Turns out there's a lot of data science behind it, in everything from procurement to forecasts to logistics: what to cook, what people will like, what ingredients are required, what to produce at scale. In this segment of the a16z Podcast, Gobble's Ooshma Garg suggests that every modern food company is really a tech company (or should be). Is there a science to taste? The views expressed here are those of the individual AH Capital Management, L.L.C. (“a16z”) personnel quoted and are not the views of a16z or its affiliates. Certain information contained in here has been obtained from third-party sources, including from portfolio companies of funds managed by a16z. While taken from sources believed to be reliable, a16z has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. This content is provided for informational purposes only, and should not be relied upon as legal, business, investment, or tax advice. You should consult your own advisers as to those matters. References to any securities or digital assets are for illustrative purposes only, and do not constitute an investment recommendation or offer to provide investment advisory services. Furthermore, this content is not directed at nor intended for use by any investors or prospective investors, and may not under any circumstances be relied upon when making a decision to invest in any fund managed by a16z. (An offering to invest in an a16z fund will be made only by the private placement memorandum, subscription agreement, and other relevant documentation of any such fund and should be read in their entirety.) Any investments or portfolio companies mentioned, referred to, or described are not representative of all investments in vehicles managed by a16z, and there can be no assurance that the investments will be profitable or that other investments made in the future will have similar characteristics or results. A list of investments made by funds managed by Andreessen Horowitz (excluding investments and certain publicly traded cryptocurrencies/ digital assets for which the issuer has not provided permission for a16z to disclose publicly) is available at https://a16z.com/investments/. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Please see https://a16z.com/disclosures for additional important information.

The content here is for informational purposes only, should not be taken as legal business tax or investment advice or be used to evaluate any investment or security and is not directed at any investors or potential investors in any A16Z fund. For more details, please see A16Z.com slash disclosures. Welcome to the A16Z podcast. I'm Michael Copeland. And we are going to talk about food. This is sort of a technology meets the holidays segment. And to help us with this is none other than Ushma Garg, who is the co-founder and CEO of Gobel. Ushma, welcome. Thanks for having me, Michael.

Ushma has been up since I don't know when, well before it was light out, because you guys get cooking at 4 a.m. Is that correct? That's right. I should say. Well, all of the above. So, Gobel, as you well know, is a sort of a food preparation, meals that come to you, almost fully prepped. You get to put them together in a very short amount of time and put them on your table and enjoy them. Correct? Am I correct here? That's right. We are your sous chef. We do all the prep work so that you can control the end result and cook in one pan in 10 minutes and have a fresh home-cooked meal for your family.

The holidays are coming up. We're all going to be doing a lot of cooking or maybe trying to avoid doing a lot of cooking. I just want to know from logistics. Like you guys, so one meal is hard enough for one person to sort of pull off over the holidays. You guys are doing that thousands upon thousands. So how do you guys approach? You know, even just an average week, but even, you know, the sort of weeks and months coming up, what do you guys have to do to sort of think about who's going to want what and how it's going to get out there? Right. This is where the data and technology really come in. We rely so heavily on user surveys, on past year behavior, and on watching how people evolve every single week to forecast exactly how much to procure of every single ingredient. and then to make the very best menus every single weekend, especially for the holidays. So we have to rely a lot on data science to figure out what to cook and what you'll like, and then on our own software to actually figure out the order in which to produce all the food so that we can actually make tens of thousands of portions of turkey stuffing and send it to you on time. Okay, so this gets to one of my questions, and I think you started getting into it a little bit,

Like, how is a food company, you know, a tech company? Great question. I think a modern food company has to be a tech company. And I've seen companies like Netflix or Pandora or Amazon really leverage all of their rich customer data to make the experience for you very personalized on their websites. And in my opinion, you know, people eat food three times a day. If any company should have the most data or insight into who a person is, it should be a food company. So from day one, when we started gobble almost five years ago, I have always been a huge nut about understanding people's taste and basically predicting exactly what they should and want to eat every single day.

And that is how it becomes a tech company and how a winning food company will succeed. Okay, so let's talk about the holidays then. when you say that you have all this data, what are some of the things you're seeing in terms of what people are doing over the next month as we get into Thanksgiving and then into the other holidays? Right. What's really fun about the holidays is that everything is about comfort food. And so we'll have our green beans and Brussels sprouts and things. But year on year, the highest selling items. Hold on a second. Are Brussels sprouts comfort food? No. No. Okay. Okay. I just want to be clear here because I'm not saying I don't like Brussels sprouts, but comfort and Brussels sprouts, those two doing it. Exactly. So the top selling items off our Thanksgiving menu are things like homemade biscuits and mashed potatoes, even simple mashed potatoes above the sweet potato mash. Oh, interesting.

It's really kind of these items that remind people of home and of comfort and of warmth, as simple as they may be, that are the highest sellers. I wonder if it's also that, you know, mashed potatoes, don't get me wrong, they're good. But if I don't have to make some side dish, then somehow I get to make the glory. dish which is the turkey like nobody is like oh my god those mashed potatoes or maybe they are but anyway the glory dish is the turkey so maybe they just want to take the hassle out of the rest of it that's right yes we we sell a lot of sides but but we also sell a lot of turkey and then of course again nowadays the easier you can make the whole process the better so we have a gobble gobble thanksgiving feast and that above everything with all the sides included and the turkey

and integrated instructions on when to start the green beans versus the turkey versus the potato so it all comes out okay. Doing all of that work for the whole feast, I think our population really appreciates. Okay. So if I order the gobble-gobble full Thanksgiving boat, how is that meal and the way it's prepared at home different than if I had to do it all by myself at home?

That's been a fun creative challenge for our team over the last few months, which is figuring out how you can prepare all these sides. as freshly as if you cooked them, but with the same kind of pre-pre and convenience of our normal day-to-day dinner kits. So, for example, the vegetables might be washed and cleaned for you and chopped as we normally do for your normal dinner kits,

but we'll actually give you, for example, a sage butter or a different spices to cook those vegetables with. And you're basically finishing the cooking of them and integrating them with some flavor so that we like to say you do the sizzle and the serve. I see. Thanksgiving and whatever your holiday meal of choice is, they're kind of high-stakes meals for good or for ill.

And so I think in some sense, and it's not as if every day a meal isn't high-stakes for you. Like, if I ordered dinner and it didn't show up, I'd be hungry. But these are especially high-stakes. So how do you guys approach that as a kind of a problem, if indeed you think of it as a problem? Yes. Well, we hope it's not a problem, but we certainly preemptively work very hard to not make it one. So we, for example, all of our shipments are going out on Monday for arrival on Tuesday. And they're built to go in your fridge and then you can cook them off on Thursday when you're about to serve Thanksgiving dinner. The reason we did that, and our team is actually working on Tuesday and Wednesday. And I'm flying home on Thanksgiving Day for that slide in arrival right at 5 p.m. Apparently, you are not cooking Thanksgiving meal.

I'll be bringing some of my easy kits. I mean, not to say that you haven't cooked it for like thousands of people already, but anyway, yes. Our mantra is that we have to make, it is such high stakes of a meal that we have to make sure that all of our customers get those dinners and those sides before we really can enjoy our own. So we have a huge gobble Thanksgiving party after all the shipments are out for hundreds of people, including some of you folks at the firm. Oh, good. And that we'll be going down after everything is successful. but we actually have emergency, you know, trucks ready for overnight shipments, a certain buffer amount of every single dish. We've been doing this for long enough to where we know how much buffer to make and how many misdeliveries we expect on any one shipment day to have contingency plans in place for the inevitable.

So something goes, you know, south a little bit and you get the frantic call and boom, there's your meal on a truck or however on a horse or a boat or however. you guys do it, yeah. That's fascinating. And, like, it's a meal at the end of the day that we all want to enjoy. But the logistics side of it, you guys seem almost more closer to Amazon than you are to the restaurant that I go to, to go have a dinner. How would you describe the logistics problem that you guys are solving and what do you bring to bear on it on a daily basis? And then here over the holidays, you mentioned you have all these contingency plans, but what does it look like from your perspective? Yes. Well, there are two huge logistic problem that we solve. One is actually producing all of the food, which is very difficult, which is actually where we focus most of our software efforts. And the second is, after all, that's produced and packaged at high quality and at high safety. It's sorting all of that into all the customer orders, more of like an Amazon like pick and pack sort of where. house operation. The actual delivery to everybody's houses, while we used to do that, and that's a fun, you know, routing problem to figure out, we now outsource that to OnTrack and FedEx. I see, because they're actually very good at that. And yes. And it allows us to reach more people. And so before, while we drove similar to an on-demand company within city limits of, let's say, a San Francisco or Palo Alto, now we can reach every home in California

and people are enjoying Thanksgiving from Gobble in San Diego, Tracy, you know, Bakersfield and Palo Alto all at the same time. So the bobble boxes or box shows up in my door on Tuesday, or yes, on Tuesday, in theory, right? Tuesday, Wednesday or Thursday? Do I hide the box immediately before my family comes over? Like, what have you guys heard from people who have used this in the past and, you know, or even on a regular basis for meals during the week? Right. That's a fun one. Some people actually hide the box. They'll open the box. They'll take out everything. They'll, you know, put it wherever they put it. One guy went so far as to tell his wife he was taking cooking classes and always has been cooking a meal before she gets home with his

gobble dinner kit. And when the box was delayed, he had emailed, you know, called, direct messaged and just said, hey, send it to my office. Like, it can't show up at my house because my wife doesn't know. So that's, it's pretty fun how people use it and make it their own. And a lot of parents even say, hey, you know, my kids think I'm a great chef, thanks to gobble. Right. What advice do you have for people who are sitting down for this meal and and kind of stressing out about it. Look, you guys are preparing meals for 10,000s of people. What kind of could translate to us just having a more calm, relaxed, enjoyable holiday meal ourselves? Oh, man. Well, this is advice for myself too. I'm a very precise and perfectionist person. And the way we designed our

dinner kits so that type A, precise perfectionist people can actually cook and get a great meal on the table without, you know, worrying, was it 11 minutes or nine minutes and that kind of thing. So I guess the advice I would give is a simple one. And that's just to relax and understand that most of the time cooking comes out great anyway because it's just made with that care and love, you know, within some like delta of time limit and reason. So the way I kind of loosened up and even got into cooking when we were inventing these dinner kits was by was by learning to flip food in my pan. I would just, you know, use a spatula or a ladle when I was first learning how to cook.

And our executive chef, Thomas Ricci, you know, taught me how to pick that pan up and flip everything so that it would cook so it would cook so much better. And after I learned that, I added a bit more fun and whimsy to the cooking experience. And it took out my type A stress. And so that's what I would tell our customers. I was going to say if you use the word delta while you're cooking, you are a different kind of chef than I know. Yes. So you're going to be at home. for Thanksgiving? I am. We have a, we have a very fun Thanksgiving tradition and I think it, you know, shows in how we run the

company. My family gets together with about 12 other families at someone's house. There's tables all over their house in the living room and a formal area and a regular area in the kitchen. And now it's almost three generations. It's grandparents, parents, their kids, and now new kids. And we've been going to the same house for 15 years and everybody brings food as a potluck. So, I actually have never missed one in all the years I've been going. Wow, that sounds like fun. I should come to your house or whomever's house that this thing is happening. Yes, you're invited.

In between like the sort of inter-holiday period, you know, between Thanksgiving and, you know, Christmas, whatever it is, you celebrate. Do people stop eating? Do they stop cooking? Are they over it? Like, is there any pattern that you see in that kind of inner holiday period? Hmm. We, well, we change the kind of food that we're serving. And of course, there's different vegetables.

vegetables that are in season that we use, you know, squashes and root vegetables. And we only see, the only shift we see is when people are traveling out of town. So most people take a longer vacation in December. If they're home and it's not a holiday, they're eating gobble. Like, it's something that people depend on and get very upset about if it doesn't show up, which is exciting to me. I want to be an integral part of your life. But, and we actually ask someone to let us.

know when they're skipping a week why it is. So they'll tell us, hey, the menu isn't good, or I'm out of town, or I'm cost-saving right now. So according to all of our results in the past, really we only see people going out of town more right now. Do you see after the first of the year, you know, that's when everybody joins a gym? Do they also like shift to like, okay, I'm only eating vegetarian now or just bring me all vegetables and raw vegetable form and etc.? Absolutely. Absolutely. It's such a funny shift. because we go from all of our, all those biscuits and mashed potatoes to lots of salads and, you know, like shredded chicken or salmon and that kind of thing. So we're ready for that shift.

January and onwards is really a game time for developing new habits for folks. And so for food services and especially subscription food services, it's good to be prepared. Are you seeing any trends in terms of how people are eating? There's, you know, there's lots of discussion. We'd all like to, let's be frank, eat healthier, that doesn't necessarily mean that we do. Right. In our menu rubric, we have a certain, we have rules around how many healthy meals and how many comfort meals we would offer or how many traditional American meals or ethnic meals. About 10% of our user base right now is vegetarian. There is a vocal population that are gluten-free.

And we do see folks that usually get our omnivore box, which is chicken, fish, and red meat. dabbling in vegetarian meals. And those are individual meals. They're not all piled in one box. That's right. They're all individual meals. So people will switch out, let's say, a beef for a vegetarian meal or chicken for a vegetarian meal.

And I care about that. And I care about a balanced diet. So we focus a lot on vegetarian meal innovation as well. And so you're saying at least people are trying to, okay, this meal, this one meal this week, I'm going to go vegetarian or, and maybe that's increasing. But like, you can't pin down a trend at this point yet. We can see more people. caring about health and food transparency and where their food comes from.

And so I slowly see more people eating. They want meat as a garnish on their food as opposed to a center of plate every single time, which I think is great and in line with what we know right now about what's most healthy for you. But we still have a lot of work to do. You admitted that you were learning how to cook, flipping, and kind of getting into it. And you did use the word delta when you were described. I've been preparing a meal.

So, and you've told me this, that you're not, you know, the world's most involved chef food person. So why did you start a food company? And how did that happen? The way it happened is that I started eating very poorly. And so I felt a direct health effect of eating takeout every day. And I was lethargic and tired and I was running another business. And I was pretty unhappy for a while. And I would talk to my family about it.

And they were heartbroken because they, spent all this time while I was growing up feeding me only home-cooked food. We would only eat out maybe once a month. So Gobble just started very organically by me solving the problem for myself and posting a Craigslist ad and asking, hey, can anyone make me home-cooked food for $8 a plate? Right. I'll get 10 friends to buy in. And the rest is history. But I would say that another piece of it is that I care a lot about family. So even though I wasn't a cook, I made the decision to start a food company because I care about family. And I think that as people grow up, as they start, you know, maybe choosing a partner or starting a family, they care about nourishing

that family. And the way they look at food evolves. So I used to eat out of a tray. And then now as I get to a certain place in life where I might start a family, I start caring about food and where it comes from. And is it healthy or not? And so that's, I think that's, I think that's, that's where my care for food comes from and now my like interest in helping food fit into this like 24-7 busy lifestyle. Let's talk about the future of food then. What is that going to start to look like? I mean, we talk about the resource kind of use, you know, whether that means meat or fishing, overfishing the oceans, et cetera, et cetera. But how do you think about it and what, and for example, we invested in a company here, soilent, you know, where you get your,

you know, nutrition out of a bottle. Right. How do you view the future of food? I'm excited about the future of food because I think that there's so much innovation going on. And I actually think that no one solution is going to own the future. I think it'll be a like constellation of solutions that fit different people and also people at different stages of life. So for example, I know some folks who do Soylent for breakfast and lunch and then they'll do gobble or cook from scratch for dinner. Right. And down the line, I would say that efficiency matters very much. So that's why things like gobble or soilant might be working. What we're seeing is that people care about efficiency, but also nutrition and access to information. So until

even companies like gobble or soilant can tell you that their solution has all the macronutrients and micronutrients required for your family to be healthy with great accuracy, there's still a question in consumers' mind and a lot of over-information that needs to be answered. But I think it's going to be a combined solution of hobbyist cooking from scratch, hopefully something like gobble or efficient daily cooking solutions, efficient powder or pill solutions, and then also the whole sensory experience of going out to dinner will absolutely remain as a really special thing to do for people with their loved ones. Yeah, I think you're right. I think for me, part of the whole transparency thing like you say is also what resources are required, you know, to raise this beef,

or put that other piece of food on your table, or is there any of it left in the ocean and therefore we should be leaving that alone altogether? Right. And to the extent that we can know more and more about that and or find more efficient ways of farming, you know, whether that's fish or produce, that's a really exciting area too. Yes, I think there'll be more information and also more regulation in those areas as we progress. One dish that you can't do without over Thanksgiving? Our turkey stuffing. It's homey, it's comfortable, and it's very true to Thanksgiving. So I look forward to that every year. I'm with you. I love stuffing. Ushma, I wish you a happy Thanksgiving. Thanks for your time. And we will look for more meals from you. Thank you so much, Michael. Thanks.