Blendid is raising at a $50 million valuation cap with a 25% discount. That valuation is quite high at this stage of business. This is especially true when you consider the company’s notably high burn rate — it saw net losses of $3,021,123 and $4,003,577 in 2018 and 2019, respectively. Thus, Blendid’s price score is weak as well as the company’s lowest across all five metrics.

At the moment, Blendid only operates automated smoothie kiosks. The smoothie market in the United States is estimated at $5.5 billion (globally, $34.2 billion and growing at a CAGR of 7.7%). The industry does have competitors, most notably Jamba Juice and Smoothie King. The former, as of 2019, operates 864 stores and saw $71 million in revenue on their most recent annual report (2017). Smoothie King has been around since 1973, and in 2018, saw sales of $435 million. Name recognition plays an important role in the food and beverage industry, Blendid certainly has ground to make up in the department. One thing going for Blendid, however, is its technological aspect. 

The food robotics industry is a small, but continuously growing industry. The COVID-19 pandemic has proven to consumers that tech and automation are the way of the future. A company like Blendid is well suited to capture much of the $1.9 billion market size (which, as noted previously, is set to grow up to $3.35 billion by 2025). Venture Capital firms are continuing to see the upside in companies like Blendid, with investments into food tech continuing to rise year to year.

Blendid’s technology could be the company’s way to access more of the smoothie market, all while keeping their number of locations minimal. The company has already signed agreements with two large global food and retail brands, signifying that the licensing side of their business already has traction. However, due to the current small size of the food robotics industry and the steep competition Blendid will face in the smoothie market, the company’s market score is slightly below average.

Blendid’s team brings decades of experience in business, engineering, and product design. Co-founder and CEO Vipin Jain has nearly 30 years of experience in business and entrepreneurship. He formerly worked as CEO of Retrevo — a machine learning company aimed at improving the shopper experience which was acquired by Barnes & Noble. After that exit, Jain functioned as VP of Sales and Customer Care at Barnes & Nobel Nook.

Jain is joined by co-founder and CTO Venki Ayalur, who was the mastermind behind the software and hardware products for Barnes & Noble Nook and Motorola Mobile. The third member of the founding team is Vice President of Engineering, Vijay Dodd. Dodd has worked at tech companies such as AT&T, Palm, as well as Barnes & Noble Nook.

The founding team of Blendid is extremely capable, with a long background with tech and business. All three founders have worked together before, which is another sign of strength for the team. It’s also promising that Jain has experienced a successful exit at a previous startup. As a result, Blendid’s team score is quite high.

Blendid blends together the food industry with a sleek, cutting edge tech spin that makes it a smoothie company poised to grow in the future. With the ease of the Blendid app, customers can pay in whatever way is easiest for them (Apple Pay, Google Pay, credit cards, and even student meal plans, wherever applicable) without needing to interact with any other people. The company’s app works in the customer’s favor as well as the kiosk operator. Customers get to input their order into the app and watch as it’s created in front of their eyes. Operators can get notified when ingredients need to be restocked or when there is an issue that needs troubleshooting. The entire smoothie creation process is carried out by robots, which is a novelty that can’t be claimed by Jamba Juice or Smoothie King. In an era where social distancing is the norm, Blendid has a competitive advantage over rivals by providing a completely automated, contactless smoothie experience.

Blendid’s technology is patented and isn’t just related to smoothie making. The company’s intellectual property encompasses robotic food preparation technology with artificial intelligence, computer vision, and distributed software processing. These patents give Blendid the freedom to expand its business to other food items — and the company expressly states that this type of expansion is their ultimate goal. A smoothie experience that’s unlike any competitor’s paired with strong intellectual property yields Blendid a very high differentiators score.

Blendid has, since its inception, generated $149,624 in total revenue. Revenue had been increasing every quarter since Q1 of the 2019 fiscal year, but the shelter-in-place orders that were instituted around the country put a pause on Blendid’s operations.

Blendid does have a very high burn rate, racking up $1.5 million, $1.3 million, $1 million, and $968k in expenses throughout the 2020 fiscal year. All of this adds up to a net loss of just under $4 million in 2020.

However, Blendid has also been focused on getting its smoothie kiosks out into the world. It has four fully operating kiosks in place throughout the San Francisco area. Additionally, Blendid has signed a letter of intent with Walmart for further kiosk expansion. This strong early traction balances out Blendid’s financial numbers, resulting in a strong performance score for the company.

The COVID-19 pandemic has impacted many industries, food services being one of the most notable. Blendid has a high burn rate, so the longer the pandemic goes on and the less revenue that comes in, the higher the likelihood of financial troubles. The company’s extremely high valuation this round may also be too steep for some investors. Lastly, Blendid will have to put significant efforts into creating a brand name for itself as it expands and finds itself competing with well-known entities like Jamba Juice and Smoothie King.

Blendid’s customer experience is extremely unique, and there is already early traction for its robotic kiosks. The company has a strong leadership team with proven successes, reducing risk for potential investors. 

Blendid has plans to scale its business into more Walmart stores (it already has a partnership with the company), as well as supermarkets around the country. If it can continue to secure funding long enough to weather the storm of COVID-19, Blendid has much room to grow into a very successful business.

Blendid has been rated a Deal to Watch because of its unique technological spin on the food industry, as well as its strong leadership team. Its existing partnerships with various California colleges, as well as Walmart, indicate good traction for the business.

Blendid faces challenges due to the ongoing pandemic, as well as a high spending rate of capital. The valuation is also quite high for a company that hasn’t shown much profitability to date, but the potential for growth is there.

For questions regarding the KingsCrowd staff pick or ratings for this company, please reach out to support@kingscrowd.com. 

Analysis written by Ethan Thomas.