Robots can cook your french fries. Is this the future of fast food?

Miso Robotics' lab in downtown Pasadena is full of robots from the past and present.

There's Sippy, Chippy and Drippy. The star of the lab: an upgraded robot named Flippy that can fry French fries and chicken nuggets much faster than humans.

Miso Robotics depends largely on its ability to convince fast-food chains to integrate Flippy — a robotic arm that drops frying baskets into sizzling oil — into their kitchens. As the restaurant industry suffers from higher costs, driven in part by rising minimum wages in California and other states, Miso is one of several tech startups betting that more companies will look for new ways to save money on employee turnover to reduce and fulfill more orders.

“You never get rid of people in restaurants, and you don’t want to,” said Rich Hull, CEO of Miso Robotics. “What you're trying to do is automate the tasks that people don't enjoy.” Flippy can process more than 100 fry baskets per hour, significantly faster than the roughly 70 baskets the company estimates employees can handle in the same period . The robot also saves workers the risk of burns from hot oil or slipping on grease.

Restaurant chains have been experimenting with robots in the kitchen for years. But while several companies, including White Castle, Sweetgreen and Chipotle, are currently testing ways to automate food preparation, circuitry and software have not yet caught on.

“We are in a very, very early stage. “The return on investment is not proven,” said John Gordon, a restaurant analyst and founder of Pacific Management Consulting Group. “There is certainly an opportunity in some restaurants because of … repetitive work being done” that is out of sight of diners.

For some companies, the initial results are promising. Los Angeles-based fast-casual restaurant Sweetgreen has been testing what the company calls its “Infinite Kitchen,” which uses machines to dispense and mix salad ingredients, then humans add the finishing touches. Two locations where the technology was tested, including one in Huntington Beach, saw improvements in order accuracy and staff turnover, while average sales were 10% higher, executives said on a recent earnings call.

Founded in 2016, Miso Robotics has tested previous versions of Flippy in around 20 restaurants, including White Castle, CaliBurger and Jack in the Box. White Castle, a burger chain with locations primarily in the Midwest and New York City region, said it expects to implement plans announced last year to introduce Flippy to nearly a third of its roughly 350 restaurants.

The fast food robotics field is littered with companies whose attempts to revolutionize the restaurant industry have failed. Last year, Silicon Valley pizza startup Zume shut down after raising $450 million from SoftBank's Vision Fund and other investors. Among other problems, the company, founded in 2015, reportedly had difficulty getting its robots to prevent melted cheese from falling off pizzas baked in a moving truck on the way to customers. And in 2022, food delivery service DoorDash closed Chowbotics — the company behind a robotic salad maker — about 18 months after buying the startup because it wasn't meeting expectations.

According to analysts, Miso Robotics appears to be at a crucial point. As of June 2024, the startup had a cumulative deficit of $122.8 million and average cash reserves of just under $4 million. The company's negative operating cash flows have raised concerns about its viability, a report filed with the U.S. Securities and Exchange Commission, it said.

Hull and other executives only started last year, and former CEO Michael Bell was fired in May 2023, another submission shows.

According to Pitchbook, the company had raised $126.5 million from investors as of March and was in the process of raising additional funding. Gordon and other analysts said they believe the company's immediate future depends largely on its ability to raise more cash as it tries to grow sales.

Hull, an early investor in Miso Robotics, is a Hollywood film producer and executive who also founded a Spanish-language streaming company, Vix Inc., which was acquired by TelevisaUnivision in 2021. He said the board of Miso and Ecolab, which invested $15 million in the company, pushed him to grow the startup, similar to what he did for the streaming business.

“Innovation is not easy. It's really hard. “Now we’re seven years ahead of everyone else, but it’s chaotic,” Hull said. “I love clutter. That’s always been my thing.”

The company plans to significantly increase its production capacity next year to meet all incoming orders, Hull said, adding that Miso aims to be profitable by the end of 2026.

Some labor market analysts wonder whether automation Will help the workers. Brian Justie, a senior research analyst at the UCLA Labor Center, visited a restaurant that used Flippy over the summer.

“Whether it's faster or cheaper than a … traditional restaurant or not, I think it was very clear that there were fewer people doing roughly the same amount of work, or more work with a limited menu,” he said.

During a demonstration in Miso Robotics' lab, Hull highlighted the improvements the company has made to Flippy, including shrinking Flippy so it can fit under the hood and over the fryers in a compact kitchen. And he said incorporating artificial intelligence technology has reduced food waste and improved shelf life, as the machine is able to troubleshoot problems with its operating system or alert a customer service representative when it is about to break down.

Miso Robotics has tested other robots designed to serve drinks at the drive-thru (Sippy) or cook and season tortilla chips (Chippy), but Hull said his engineers are focused on the frying robot for now. When the startup introduced the robot in 2017, Miso initially designed Flippy to flip burgers, but the company changed course when it saw greater sales opportunities with fried foods, he said.

Miso executives believe the frying technology could be a major boon for the company, claiming in a government document that “Flippy’s fry station automation represents a potentially massive $3.5 billion revenue opportunity for Miso alone in a market that is “Importantly, it is still fragmented.” underdeveloped, undercapitalized and full of growth opportunities for a company with Miso’s first-mover advantage.”

Restaurants can buy or lease the robot, and the company earns money as well as maintenance, software upgrades and technical support. Most customers lease Flippy for $5,000 to $6,000 per month, but several factors can affect pricing, including the number of fryers in a restaurant.

Several chains, including Panera, Jack in the Box, Chipotle and Buffalo Wild Wings, have been testing miso's technology since 2021, SEC filings show. Many of the companies declined to elaborate on whether the robots resulted in cost savings, but pointed to other benefits.

At White Castle, for example, Flippy robots have allowed employees to better focus on other aspects that improve the customer experience, such as: B. Order accuracy and hospitality, said Jamie Richardson, the chain's vice president of marketing and public relations.

The burger chain turned to Miso after realizing that the drive-through and fry station employees were juggling multiple responsibilities and orders. White Castle also worked with SoundHound to test an AI voice assistant called Julia (named after a popular 1930s White Castle host named Julia Joyce) to help take drive-thru orders. In June, McDonald's announced it would end a similar pilot program with IBM amid reports the technology had problems with people's accents.

Because there are many variables at play, White Castle did not measure whether Flippy improved employee retention, Richardson said. So far there has been positive feedback about the robot from employees.

“People who come to us want hot, tasty and affordable food,” he said. “If you can eliminate the weak points, if you can reduce the friction, everyone will win.”

Curt Garner, chief customer and technology officer at Chipotle, said the restaurant chain tested Miso's tortilla chip-making robot at an Orange County location from 2021 to 2023. Even though the pilot ended last year, Garner said the restaurant has implemented the lessons learned into other products.

Chipotle, which has a $100 million venture fund, has invested in other startups including Vebu Labs, which was founded and led by James Jordan, the president and chief executive of Miso Robotics. The partnership gave birth to Autocado, which cuts, pits and peels avocados before workers hand-mash them into guacamole. The company has also invested in San Jose-based Hyphen to create what it calls an “expanded makeline” that uses automated technology to make bowls and salads, while Chipotle employees make burritos, tacos, quesadillas and kids' meals.

Jot Condie, president and CEO of the California Restaurant Assn., said the COVID-19 pandemic has increased interest in using automation and technology in restaurants.

He expects much of the adoption to occur in fast-casual restaurants, where convenience and efficiency are paramount, rather than full-service restaurants, where interaction with friendly servers is a more important part of the experience.

“Quick-service restaurants like Chipotle that have the ability and resources to invest and adopt technology will lead the way in some ways,” he said.