Dishserve: Asset-Light Cloud Kitchens in Jakarta

The Evolution of Cloud Kitchens and a Novel Approach by DishServe

Cloud kitchens are designed to alleviate infrastructure costs for food and beverage companies by offering centralized meal preparation facilities for delivery services. Consequently, cloud kitchen operators are tasked with establishing a sufficient network of locations to satisfy client demand, all while guaranteeing swift deliveries to consumers.

DishServe, an Indonesian network, has pioneered a more streamlined, asset-light model for managing cloud kitchen networks. Founded by a former chief operating officer of the budget hotel startup RedDoorz, DishServe collaborates with home kitchens rather than investing in or leasing its own facilities.

Currently, the company partners with nearly 100 home kitchens in Jakarta, concentrating on small and medium-sized F&B brands and functioning as their last-mile delivery solution. Launched in the autumn of 2020, DishServe secured an undisclosed amount of pre-seed funding from Insignia Ventures Partners.

The Genesis of DishServe

DishServe was established in September 2020 by Rishabh Singhi. Following his departure from RedDoorz in late 2019, Singhi relocated to New York, intending to launch a new hospitality venture focused on rapidly converting commercial spaces into members’ clubs similar to Soho House.

The company had already developed prototype pre-fabricated rooms and was on the verge of securing leases when the COVID-19 lockdown commenced in New York City in March 2020. Singhi described this period as a time of introspection, during which he re-evaluated his plans and considered a return to Southeast Asia.

He observed that the pandemic-induced shift to online ordering and delivery could level the playing field for smaller F&B businesses competing with industry giants like McDonald’s. However, lockdowns restricted consumer choices to restaurants within close proximity.

Simultaneously, Singhi recognized a significant number of individuals, such as stay-at-home parents, seeking income opportunities that allowed them to work remotely.

Connecting Brands, Entrepreneurs, and Diners

DishServe was conceived to bridge these three elements: F&B brands aiming to expand without substantial capital expenditure, home-based entrepreneurs, and consumers desiring a wider range of dining options. The founding team also includes Stefanie Irma, a former RedDoorz country head for the Philippines, serial entrepreneur Vinav Bhanawat, and Fathhi Mohamed, a co-founder of Sri Lankan on-demand taxi service PickMe.

The company collaborates with F&B brands that typically operate between one and fifteen retail locations, seeking to augment their delivery capabilities without opening new establishments. DishServe’s clientele also encompasses cloud kitchen companies utilizing its home kitchen network for last-mile distribution and catering services.

“Brands avoid significant upfront investments, and distribution becomes more cost-effective as they bypass expenses like electricity and plumbing,” Singhi explained. “Furthermore, it provides agents with the opportunity to earn income from their homes.”

Operational Mechanics

Prior to integrating a home kitchen into its network, DishServe conducts a screening process, requesting photographs and performing an on-site inspection. Accepted kitchens are upgraded with standardized equipment, with DishServe covering the conversion costs, typically around $500 USD and taking approximately three hours.

DishServe retains ownership of the equipment, reclaiming it should a kitchen discontinue its partnership. Singhi stated that the conversion costs are generally recouped within four months of the kitchen’s operation.

Home kitchens initially serve DishServe’s own white-label brand as a trial before becoming available to other brands, with each kitchen capable of supporting up to three brands concurrently.

It’s crucial to note that DishServe’s home kitchens, generally managed by a single individual, do not engage in food preparation. F&B brands supply the ingredients, and kitchen operators adhere to standardized procedures for heating, assembling, and packaging meals for pickup and delivery.

Screenshots of DishServe’s apps for home kitchen operators and customers. Image Credits: DishServe

DishServe ensures adherence to standard operating procedures and hygiene standards through regular online audits. Agents submit photos and videos of their kitchens based on a checklist covering food preparation areas, floors, walls, hand-washing stations, and freezers.

Approximately 90% of DishServe’s agents are women aged 30 to 55, with an average household income of $1,000. Through DishServe, they typically earn an additional $600 per month when operating at full capacity with four brands. DishServe’s revenue model involves revenue sharing between F&B brands and its agents.

Upon joining DishServe, F&B brands select their preferred home kitchens and distribute ingredients, utilizing DishServe’s real-time dashboard for inventory monitoring. Certain ingredients have a shelf life of up to six months, while perishable items like produce, dairy, and eggs are delivered daily.

DishServe’s onboarding “starter pack” allows brands to select five kitchens, though Singhi notes that most brands typically begin with 10 to 20 kitchens to expand their delivery range within Jakarta and reduce costs through bulk meal preparation.

Future Expansion and Vision

DishServe intends to concentrate on expanding its network within Jakarta until at least the end of the year, before venturing into other cities. “Our goal is to transform the F&B industry from its current highly concentrated, centralized model to a decentralized system, empowering micro-entrepreneurs to function as a distribution network,” Singhi concluded.