Chipotle Mexican Grill is taking a more active role in shaping the future of restaurant technology.
The Newport Beach, California-based fast-casual brand, which owns and operates nearly 3,000 restaurants across five countries, announced Tuesday (April 19) that it is forming a venture capital fund, Cultivate Next. The fund aims to invest $50 million in Series B stage companies creating restaurant technology solutions or other products and services in line with Chipotle’s goals.
“We are exploring investments in emerging innovation that will enhance our employee and guest experience, and quite possibly revolutionize the restaurant industry,” said Chipotle Chief Technology Officer Curt Garner in a statement. “Investing in forward-thinking ventures that are looking to drive meaningful change at scale will help accelerate Chipotle’s aggressive growth plans.”
The move comes at a time when, in the face of high demand and a difficult labor market, restaurant companies are seeking out tech solutions to reduce their day-to-day labor needs and improve operational efficiency with greater urgency than in previous years.
This initiative will not be the first time that the fast-casual brand has backed technology companies. In March of last year, the company announced an investment in robotic delivery company Nuro as part of the firm’s Series C funding round. At the time, Garner stated that the restaurant brand believes the technology “could change the traditional delivery model” and that it was in line with Chipotle’s goal of “increasing access and convenience.”
Read more: Chipotle Invests in Driverless Delivery Company Nuro
While it is not unusual for restaurant brands to invest in promising restaurant technology solutions, Chipotle is somewhat unusual in announcing a venture fund to do so and in publicizing the amount that the brand is looking to invest in such companies.
Danny Meyer, founder of Shake Shack and restaurant company Union Square Hospitality Group (USHG), co-founded and serves as managing partner of Enlightened Hospitality Investments, which is affiliated with USHG and which invests in hospitality companies. Most recently, the company announced in February its participation in an $80 million Series C funding round for restaurant team management platform 7shifts.
See more: Restaurant Management Tech Startup Raises $80M Series C
Also in February, Yum Brands, parent company of KFC, Pizza Hut, Taco Bell and The Habit Burger Grill, announced its participation in a $12 million funding round for computer vision restaurant management software company Agot AI. At the time, Gavin Felder, the company’s chief strategy officer, commented that early trials of the technology “indicate a promising potential” to boost order accuracy and improve the customer experience.
Chipotle, for its part, has made moves to get involved not only in funding technology solutions but also in supporting growth-stage ventures meant to address food system issues. In 2018, the company announced an initiative program in partnership with nonprofit social impact accelerator Uncharted called the Chipotle Aluminaries Project offering mentorship, coaching and more to up to eight such companies. The restaurant brand announced its most recent round of participants in the program in August.
Read more: Chipotle Unveils Food Accelerator Program