A Wonder in New York City. | Robert Sietsema/Eater NY
Wonder wants to fix food delivery — so it just acquired Grubhub
On November 13, Wonder, the company that describes itself as “a new kind of food hall,” announced its acquisition of the established food ordering and delivery platform Grubhub. The acquisition brings Wonder one step closer to its goal of becoming the “super app for meal time” by allowing the company to offer Grubhub’s restaurant partners in its app alongside its existing offerings; Wonder will also become available through Grubhub.
The company also announced $250 million in new investments “‘to further its mission and growth,” and that’s on top of the $700 million in capital it announced in March. In a year full of failing chains and struggling food-delivery startups, Grubhub among them, Wonder is emerging as a winner — and it’s barely gotten started.
If the company has its way, Wonder will be unavoidable in the coming years, at least in the Northeastern United States. As of this writing, it has 30 open locations and another 18 set to open early 2025, with most of those in New York City and steady expansion into Connecticut, New Jersey, Pennsylvania, and Rhode Island. That trajectory follows the plans that CEO and founder Marc Lore detailed earlier this year: to expand from 11 locations in March 2024 to 35 by the end of year to 90 by the end of 2025. That surge is especially shocking considering that Wonder only started opening physical locations in 2023. As it grows, here’s what you need to know.
Who’s behind Wonder?
The e-commerce entrepreneur Marc Lore, who ran e-commerce at Walmart from 2016 to 2021, founded Wonder in 2018. Before that, Lore was a co-founder of Jet.com, which Walmart acquired for approximately $3 billion in 2016. Lore was also the co-founder of Quidsi, which ran e-commerce sites including Diapers.com and Wag.com until it was acquired by Amazon in 2010. Lore’s current level of involvement in Wonder is relatively recent: While at Walmart, he initially acted in more of an advisory role, leaving his brother Chad Lore to run the company, before coming on as CEO of the Wonder Group, Wonder’s parent company, in 2021. Wonder also has investment from companies including Bain Capital Ventures, Amex Ventures, and Nestlé.
How does Wonder work?
What Wonder promises is the ability to order “from multiple restaurants at once.” Instead of a food hall in which every vendor has its own kitchen, each cooking one menu, one physical Wonder location offers the menus of multiple “restaurants” from one kitchen. Some of this food comes from existing brands like the Brooklyn pizza restaurant Di Fara. Others exist only in Wonder, including chef-partnered concepts like Yasas by Michael Symon and Walnut Lane by Jonathan Waxman. According to the trade publication Restaurant Business, the company pays its chef and restaurant partners a fee and stock in the company, which allows Wonder to then use their brands and recipes without royalties. These chefs work with Wonder to make the dishes suitable for large-scale delivery. As of March 2024, Wonder offered “as many as 500 items available for order at a given Wonder, across 28 distinct menus,” according to the New York Times.
In this way, Wonder is a part of the rise of virtual restaurants. But unlike the situation with many ghost kitchens — in which the fact that the food is coming from a ghost kitchen, or a known restaurant operating under a new virtual brand, is unclear to the consumer — Wonder is making its singular location and shared kitchen its selling point.
How is Wonder different from other delivery platforms?
Unless customers are dining in — which is an option at Wonder, though not its priority — these meals are then delivered by Wonder couriers. As Lore told Business Insider last year, Wonder’s benefit over its competitors is that “[w]e’re vertically integrated. We do everything. It’s our app. It’s our delivery, and it’s our cooking. We own the rights to those brands.” (Of course, with the Grubhub acquisition, Wonder will now also be available via Grubhub; the company hasn’t specified if or how it’ll take over delivery.)
As Kristen Hawley wrote for Eater in April, what sets Wonder apart is its control of “the entire experience, from recipe to fulfillment, and the company has spent $60 million so far on intellectual property — recipes and restaurant concepts — from its partner chefs.” Hawley also noted Wonder’s “savvy curatorial eye,” explaining that as with the early days of Caviar, when it touted take-out access to higher-end restaurants than other food-ordering platforms, the company offers “proximity” to more elevated experiences.
Wonder hasn’t always worked this way, however. Its initial model involved driving Mercedes Sprinter vans to customers’ homes. The food was partially cooked in a Wonder kitchen facility and then finished on-location in the vans, which were outfitted with rapid-cook ovens. As the Wall Street Journal reported in 2022, the Wonder vans became contentious in the neighborhoods where the program was piloted, with some residents complining about the vans being noisy and blocking driveways. In January of 2023, Wonder shut down its van program. Lore told Business Insider that the company could scale faster and with better profit margins by shifting to fixed locations.
How does Wonder make its food?
The basic setup of the van model hasn’t been fully phased out. As the Times explained earlier this year in a profile of Lore, Wonder’s food is prepared and often par-cooked in a commissary kitchen. (Wonder currently has one central kitchen in New Jersey and has plans to open another in Pennsylvania as it adds locations.) At that point, it’s distributed to its restaurants, which finish the food with — in Lore’s terminology — “lightly trained labor” using only a hot water bath, a rapid-cook oven, or a fryer. Because the kitchens don’t have gas stoves or the need for exhaust systems, Wonder kitchens can be built quickly and affordably, the Times notes.
Given that slow delivery is one of the problems Wonder is trying to solve, Lore has stated that efficiency in both preparing food and getting it to customers is a big goal now and moving forward. Currently, Wonder reportedly delivers food in around 30 minutes.
Is Wonder good?
Wonder seems to be about as good as any food hall, which is to say, hit or miss. When Eater NY restaurant critic Robert Sietsema reviewed the Chelsea location’s food in May, he found the pizza to be a solid Di Fara pie, though it lacked the signature basil finish; other options, like the Tejas Barbecue brisket sandwich and Yasas by Michael Symon pepper and feta sandwich missed the mark. Most of what Sietsema tried earned around a B. Grub Street critic Matthew Schneier had similar overall takeaways but a better experience with the brisket sandwich.
Where will Wonder go from here?
According to the Wall Street Journal, buying Grubhub not only provides Wonder with a new source of revenue, but also gives the company access to Grubhub’s delivery drivers and delivery technology. Per the November 13 press release, Wonder sees the partnership as helping its goal of “re-envisioning the future of food delivery” and making “great food more accessible.”
A timeline of major Wonder moments:
2020: Wonder begins piloting its van program in parts of Westfield, New Jersey. By 2021, it had expanded to serve the entire town.
December 2021: Marc Lore steps in as CEO.
January 2023: Wonder pivots away from van delivery in favor of fixed locations.
February 2023: Wonder opens its first NYC location in the Upper West Side.
November 2023: Wonder completes its acquisition of the meal kit company Blue Apron, allowing users of the Wonder app to order Blue Apron kits in addition to Wonder meals. Wonder takes over Blue Apron delivery.
February 2024: Wonder opens its first location inside a Walmart store.
April 2024: Wonder acquires Relay, a NY-based delivery company.
March 2023: Wonder raises $700 million to fund its growth plans.
October 2024: Wonder opens its first location inside a Cumberland Farms convenience store. Tony Hoggett, who previously ran the grocery program at Amazon, joins Wonder.
November 2024: Wonder announces its acquisition of Grubhub.
