What if your next burger didn’t come from a drive-thru or grill but a vending machine? That’s the idea behind RoboBurger, the Jersey City startup hoping to reshape fast food with machines that whip up fresh, customizable burgers in under four minutes.
Cofounders Dan Braido, Audley Wilson, and Andy Siegel recently presented their ambitious pitch on ABC’s Shark Tank. They aimed for $1.5 million in funding for just 5% of their company. A roller coaster of skepticism, surprises, and a deal followed.
Don’t Miss:
The pitch didn’t start on a high note. Investor Kevin O’Leary immediately labeled the presentation “chaotic” and demanded clarity on RoboBurger’s profitability. “How do I make money? All the rest doesn’t matter,” he said.
Undeterred, the team demonstrated their $3,000-per-month vending machine, which turned out a “rethermalized” burger – a term that sparked some laughs. Mark Cuban joked it was “a fancy word for ‘reheated,'” though Braido clarified the patties are grilled in the machine, creating a crust while locking in the juices.
The Sharks agreed the burgers were tasty, but eyebrows shot up when the founders revealed a $30 million valuation.
See Also: If there was a new fund backed by Jeff Bezos offering a 7-9% target yield with monthly dividends would you invest in it?
RoboBurger sold over 12,000 burgers during an 18-month beta test, with prices ranging from $5.99 to $6.99 and projected annual revenue of $1.4 million. However, with a $700,000 expected loss for the year, the request for $1.5 million seemed like a gamble.
Another point of contention was the financial model. RoboBurger leases machines for $3,000 per month or sells them outright, leaving buyers responsible for stocking. Mark Cuban warned that vending machines are costly to produce and maintain, calling them “hard capital assets” in an industry where technology quickly becomes outdated.
He suggested RoboBurger pivot to licensing its technology. Michael Rubin, Fanatics CEO and guest Shark, echoed the concerns. “How many businesses can realistically afford $3,000 a month plus food costs?” he asked. Still, Rubin saw potential, calling it a “big idea” with the possibility of scaling into a multibillion-dollar business.
