Tech roundup: IHOP hopes virtual brands will light up empty kitchens

Thrilled Cheese and Super Mega Dilla were created in partnership with Nextbite. Also, an upscale-casual operator joins Reef and startup Zitti raises $4 million.
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Photo illustration by Nico Heins

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Today I learned that a majority of IHOP’s 1,650 restaurants have two whole kitchens, which it apparently needs to handle the mad rush for pancakes on weekends.

But for most of the week, the second kitchens “sit absolutely dark,” said brand President Jay Johns during the company’s investors day earlier this month.

That’s one big reason the pancake chain has decided to try a pair of virtual brands. The two concepts—Thrilled Cheese and Super Mega Dilla—are intended to help keep those kitchens moving during slower dayparts.

They were created in partnership with virtual brand company Nextbite and are currently available at 50 IHOPs in nine states. 

“We have tremendous capacity to generate more business out of these kitchens, especially at p.m. and overnight hours when we're slower,” Johns said, according to a transcript from financial services site Sentieo.

The menus—plussed-up grilled cheese and quesadillas, respectively—are designed to be easy for kitchen staff to execute and also don’t compete with IHOP’s core breakfast daypart. They can be prepared on the same griddles IHOP uses for its pancakes.

“We chose those items because they fit what we do best, cooking on flat-top grills,” Johns told investors.

The brands appear to be Nextbite’s first collaboration with a large restaurant chain, an initiative supported by the addition last year of former Red Robin CEO Denny Marie Post as an advisor. Nextbite offers more than a dozen delivery-only brands that restaurants can bring into their kitchens as additional revenue streams.

The One Group is testing ghost kitchens with Reef. The owner of STK and Kona Grill said it’s licensing the brands to three of Reef’s delivery-only units in Texas, marking a rare move by a polished-casual operator into the ghost kitchen space. CEO Emanuel Hilario told investors that the arrangement will allow the company to enter markets where it has no restaurants and will also generate auxiliary sales. He revealed the news on the company’s earnings call last week, according to a transcript from financial services site Sentieo. 

Zitti raised $4 million for its financial software for restaurants. The startup wants to improve how small operators deal with vendors, offering tools intended to streamline invoicing and purchasing and secure better terms with suppliers. The round was led by Crossbeam Venture Partners. The company is also backed by Mario Del Pero and Ellen Chen, the founders of Mendocino Farms. 

ChowNow is partnering with Cartwheel to bring delivery tools to independent restaurants. Cartwheel’s Hybrid Delivery technology allows restaurants to manage both self-delivery and third-party delivery programs. Until now, it had worked with large chains like Portillo’s, but the integration with online ordering service ChowNow will make it available to more than 22,000 independents. Hybrid Delivery allows restaurants to select certain orders for self-delivery while leaving others to third parties.

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