The food delivery startup Wonder announced it cut 150 jobs, which is about 7% of its workforce. This decision comes as the company shifts its focus towards investing in automation and robotics.
Founded by Marc Lore, who has a background in creating successful companies like Jet.com and Diapers.com and ran Walmart.com until 2021, Wonder operates 140 retail locations primarily in the Northeast. Customers can order gourmet takeout meals inspired by recipes from celebrity chefs, including Bobby Flay, along with offerings from well-known restaurants.
The job reductions spanned various corporate teams and are intended to help Wonder concentrate on critical areas that are vital for its growth. These areas include physical expansion and technology investments, as noted by the company in a statement.
No retail locations were closed, and Wonder still aims to finish the year with 175 locations.
“As we embark on this next chapter, we had to make tough choices regarding staffing to better direct our resources towards growth,” a spokesperson for Wonder shared. “We understand the effect this has on our team and are dedicated to assisting them during this transition.”
This comes shortly after a significant $650 million investment secured in July, which valued the New York City-based startup at around $9 billion. Since its inception in 2018, Wonder has raised over $3 billion and is preparing for an initial public offering likely within the next couple of years.
Wonder has also engaged in notable acquisitions, including Grubhub for $625 million last year and Blue Apron for $103 million in 2023.
Lore has previously mentioned that Wonder’s rapid growth is supported by its distinctive all-electric kitchen design, which removes the need for traditional cooking setups like hoods and gas flames. Initially, the company operated mobile kitchens that would prepare chef-crafted meals right outside customers’ homes.
In 2023, the company transitioned to physical kitchens aimed at takeout service.
ARK Invest, one of its investors, referred to Wonder as a “disruptive” entity because it is capable of delivering “restaurant-quality food at scale,” according to a statement made by CEO Cathie Wood in relation to the July investment.
Wonder’s menu features dishes from around 30 restaurant brands, and it has also acquired brands like Blue Ribbon Chicken, Mighty Quinn’s BBQ, and most recently, Salt Hank’s.
However, the company faces financial hurdles. Wonder does not expect to reach cash flow positivity until 2030, projecting a cash burn of almost $2.7 billion through 2029, as reported by The Information.
“Wonder is rapidly expanding to create a perception of significant growth and demand,” said retail consultant Brittain Ladd. He added that the strategy involves opening new restaurants quickly to attract investors for a successful IPO.
