When I first joined Uber in 2011 to launch the app in Chicago, Uber’s fourth city, a ride at the push of a button was still a novel idea. Smartphones weren’t yet ubiquitous — we had to loan out iPhones to drivers — and people didn’t yet grasp the impact it would have on their lives.
Years later, Uber has overcome (most of) the initial obstacles and it’s hard to imagine a world without ridesharing. You can turn Uber on in a new city, and like magic, a new transportation system appears. I recently left Uber because I saw an opportunity to bring that same instant magic to another piece of our daily routines: grabbing a coffee. It’s something many of us do daily, to the point where we give it very little thought or attention. And yet, there’s a lot of room for improvement.
Building the US’s first mobile-only retail coffee brand
We’re excited to introduce Bandit, the first coffee shop in the US where ordering and payment is solely managed through an easy-to-use, innovative mobile app. That’s right: no misspelled names on cups, no pulling out your credit card, and no waiting in line, ever. While in the US mobile-only ordering has yet to take over in retail, in places like China, app-only coffee shops are booming. Luckin Coffee is a mobile-only shop that has expanded to over 2,300 locations in China and has a market cap of nearly 4.5 billion. Keep in mind, the brand opened its first store in October 2017, making it barely two years old!
While it’s already a proven model in China, it’s also clear that there’s an appetite for mobile ordering here in the US. The Starbucks mobile app has been so successful that case studies have been written about it and Starbucks is trying to keep up by opening their first app-only location. What makes Bandit different is that it was built with tech at its core, from the ground up, so we can deliver the best customer experience and drive unparalleled levels of operational efficiency.
Activating vacant spaces with modular, movable coffee shops
Although one of our core innovations is the mobile app experience itself, we’re also reinventing coffee shop construction. Bandit cafes are built modularly, off-site in a manufacturing plant in the United States. This speeds deployments and leads to huge cost and time savings. Just as “cloud kitchens” are the future of restaurant and food delivery infrastructure, we believe our model is the future of retail design and build. Because of this rapid build and ability to customize the size and shape with modular design, we can build and deploy a fully-capable coffee shop in a few weeks and launch in just a few hours in any type of location — vacant retail storefronts, newsstands, lobbies, or stores-within-stores. Our commercial real estate partners are loving that speed and flexibility.
“We were impressed with Bandit’s ability to take a raw space and quickly create a full-service cafe with their modular, self-contained unit. Our customer across our tenant base really enjoys the space. The app has been well received by customers, serving as a tremendous amenity and community-space to the building.” — Whitney Arcaro, Head of Marketing and Retail Leasing, RXR Realty
All of this innovation, including a streamlined ordering and payment process, means we’re able to charge 25% less than the average coffee shop in New York City, our first test market. We aim to have a delicious, high-quality product at an affordable price point. And it’s working — over 60% of our customers have come back to Bandit more than once since beta launch.
Being app-based comes with other advantages, too. Because all of your ordering and payments are done from the same place, we can experiment with customer loyalty in new and exciting ways. We’re currently testing a new subscription model, where for a low monthly price, you’ll get access to unlimited $1 drinks at Bandit, which includes hot and cold coffee, espresso and matcha drinks.
My co-founder James Gallagher gained deep experience building cloud kitchens and scaling retail operations during his time as COO at Good Uncle, where he led an amazing team focused on “reimagining the dining hall” on college campuses. The company was acquired by Aramark (NYSE: ARMK) earlier this year, which is when we first decided to partner up on Bandit. We incorporated in June and have been off to the races since then.
Bandit is available today on iPhone and Android, and has a flagship location at 466 Lexington Ave with plans to expand quickly throughout NYC and beyond. We’ve already served thousands of customers and have heard amazing feedback as people make Bandit an integral part of their daily routines.