Tech Check is a regular column on restaurant technology by Senior Editor Joe Guszkowski. It's also a newsletter.
Let’s be real: MrBeast Burger didn’t become the biggest virtual brand in the U.S. because people love its burgers.
It got there because of MrBeast, aka Jimmy Donaldson, the YouTube mega-influencer whose more than 100 million adoring fans seem to hang on his every word.
Donaldson’s larger-than-life profile made the delivery-only restaurant brand an overnight success when it launched in late 2020. He has since carried MrBeast Burger past a number of major milestones, including 1 million burgers sold, a reported $100 million in total revenue and an alleged world record for most burgers sold in one day by a single restaurant.
Virtual Dining Concepts (VDC), the company that owns MrBeast Burger and other celebrity-backed virtual brands, has not been shy about the fact that the concept owes its success to MrBeast. Virtual brands need “super-engaged fandom,” CEO Stephanie Sollers said at the FSTEC conference in September. “It’s about being with those leaders with the most valuable IP in the world.”
Hey, it works in Hollywood!
Except there’s a problem with putting all of your eggs in one influencer’s basket: What if the influencer’s influence starts working against you?
MrBeast Burger is learning that lesson the hard way after MrBeast over the weekend appeared to sever ties with the concept. In now-deleted tweets to his 30 million Twitter followers, Beast wrote that he could no longer guarantee the food’s quality and that he was more interested in his candy bar company, Feastables.
It’s still unclear what exactly this means for MrBeast Burger. Donaldson noted that because of his agreement with VDC, he can’t just shut down the brand. Its website is still up and taking orders. VDC has not responded to multiple requests for comment.
But what is clear is that MrBeast Burger needs MrBeast a lot more than he needs MrBeast Burger.
The episode challenges what has become conventional wisdom for building virtual brands: Rather than undertake the monumental task of creating a restaurant from scratch, rope in a famous person and use their audience to get attention.
The strategy has led to an outpouring of celeb-sponsored virtual brands over the past few years, from Guy Fieri’s Flavortown Kitchen to Another Wing by DJ Khaled to Dwyane Wade Burgers.
Of course, few if any of these concepts have worked nearly as well as MrBeast Burger. But the risk was low relative to the reward for hitting the right formula.
In light of the MrBeast situation, however, the risk suddenly seems much greater. After all, if celeb tie-ins are such a bright idea, why have so few actual restaurant chains done the same thing? Because people are fallible, and food isn’t.
Look no further than Subway and Papa Johns to see how even the most seemingly innocuous spokesperson can turn toxic. (And let’s just hope something awful doesn’t come out about Roy Rogers.)
Unfortunately, this development puts virtual brands in a tight spot. Because it is truly very difficult to create a viable brand with no physical presence.
If virtual brands want to survive, it seems they’ll have to find another path to scale. Right now, that path appears to be teaming up with big chains. IHOP, for instance, is embracing delivery-only brands as it looks to fill in slow dayparts. With nearly 2,000 locations, it has both the resources and the size to support brands that would otherwise have little awareness. This approach could also solve some of the food quality and consistency issues MrBeast highlighted.
As for MrBeast Burger, I’d be surprised if it disappears entirely. But it’s hard to imagine fans continuing to flock to it without its namesake’s endorsement.