Retail giant Lotte’s startup accelerator arm Lotte Accelerator announced on March 29 that it has invested 1.5 billion won ($ 1.31 milliom) in shared kitchen service startup Simple Project.
“We see that an increasing number of people will use food delivery services, instead of going to a restaurant. This trend is already being reflected in the sales growth of delivery startups such as Baedal Minjok. We thought that the demands for shared kitchen services would also surge with this trend,” Kim Young-duk, managing director of Lotte Accelerator told The Investor.
Established in 2015, Simple Project was the first to move into the shared kitchen market in Korea. The shared kitchen service offers cooking facilities and space for anyone who wants to start a food business but does not have the assets to open their own restaurant.
Lotte Accelerator also believes that Simple Project has enough competitiveness to compete with foreign competitors like City Storage Systems’ Cloud Kitchens, which is managed by former Uber CEO Travis Kalanick and is preparing to enter Korea next month.
“We think that Simple Project’s case is similar to shared office operator Fastfive, which is competing well against WeWork that is aggressively expanding presence in Korea.” Kim said. He added that the shared kitchen market will grow drastically, thus it would be impossible for a single firm to take up all the market share. “As long as Simple Project becomes one of the top 5 shared kitchen operators, we think that it would be meaningful,” Kim added.