News

Zume Pizza lays off 172 workers in Mountain View

Robotic-pizza business pivots away from pizza to packaging, food delivery automation

Zume Pizza, the Mountain View startup premised on pizza-baking robots, announced this week it was terminating most of its workforce as part of a company-wide business pivot.

Zume, which started four years ago in a Rex Manor industrial space, announced Wednesday it would lay off more than 250 employees, most located at its Mountain View headquarters.

Zume Pizza showed a ravenous appetite for expansion, quickly spreading across the Bay Area and blanketing cities with promotional deals. The company was particularly adept at selling itself to one important group: investors. As of just a couple months ago, Zume Inc. was still attracting massive capital, with some investors claiming the company should be valued as high as $4 billion.

But even as Zume continued to grow, it struggled to figure out its core business. As of 2018, the company began downplaying its pizza and rebranding itself as an automation platform for other food enterprises. More recently, Zume dusted off its patents for sustainable pizza boxes, and began branching out into selling food packaging.

In an announcement to employees this week, Zume CEO and co-founder Alex Garden said the company was shutting down its pizza operation entirely to focus on other opportunities. He emphasized the company would transition to work on molded-fiber food packaging and automated food production and delivery systems for other companies.

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According to filings made with the state Employment Development Department, Zume is terminating a total of 172 employees who worked out of the Mountain View headquarters at 250 Polaris Ave., as well as an additional 80 workers from the company's San Francisco office. Other media outlets reported that 80 more Zume employees were let go from its office in Seattle. The total layoffs comprise 53% of Zume's workforce, according to the company.

"These decisions were incredibly difficult, as we could not have reached our current success without the talents of these same people," Garden wrote in the letter to employees. "We have done everything we reasonably can as a company to offer exit packages that will ease the transition."

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Zume Pizza lays off 172 workers in Mountain View

Robotic-pizza business pivots away from pizza to packaging, food delivery automation

by / Mountain View Voice

Uploaded: Thu, Jan 9, 2020, 4:57 pm

Zume Pizza, the Mountain View startup premised on pizza-baking robots, announced this week it was terminating most of its workforce as part of a company-wide business pivot.

Zume, which started four years ago in a Rex Manor industrial space, announced Wednesday it would lay off more than 250 employees, most located at its Mountain View headquarters.

Zume Pizza showed a ravenous appetite for expansion, quickly spreading across the Bay Area and blanketing cities with promotional deals. The company was particularly adept at selling itself to one important group: investors. As of just a couple months ago, Zume Inc. was still attracting massive capital, with some investors claiming the company should be valued as high as $4 billion.

But even as Zume continued to grow, it struggled to figure out its core business. As of 2018, the company began downplaying its pizza and rebranding itself as an automation platform for other food enterprises. More recently, Zume dusted off its patents for sustainable pizza boxes, and began branching out into selling food packaging.

In an announcement to employees this week, Zume CEO and co-founder Alex Garden said the company was shutting down its pizza operation entirely to focus on other opportunities. He emphasized the company would transition to work on molded-fiber food packaging and automated food production and delivery systems for other companies.

According to filings made with the state Employment Development Department, Zume is terminating a total of 172 employees who worked out of the Mountain View headquarters at 250 Polaris Ave., as well as an additional 80 workers from the company's San Francisco office. Other media outlets reported that 80 more Zume employees were let go from its office in Seattle. The total layoffs comprise 53% of Zume's workforce, according to the company.

"These decisions were incredibly difficult, as we could not have reached our current success without the talents of these same people," Garden wrote in the letter to employees. "We have done everything we reasonably can as a company to offer exit packages that will ease the transition."

Comments

Nutmac
another community
on Jan 10, 2020 at 11:12 am
Nutmac, another community
on Jan 10, 2020 at 11:12 am
13 people like this

It baffles my mind that Zune actually has more than 250 employees. Convenience aside, which is debatable, their pizza is just alright at best. I frankly think nearby Papa John's is much better, which is also much cheaper to boot (at least if you use their always available coupons).


Shame
Another Mountain View Neighborhood
on Jan 10, 2020 at 11:38 am
Shame, Another Mountain View Neighborhood
on Jan 10, 2020 at 11:38 am
20 people like this

It's too bad that all these people lost their jobs. That said, this was entirely predictable based on how their pizza tasted: mediocre, even by MV standards. I want my pizza made by Italians, not robots, thank you.

I find these companies where the actual product takes a backseat to the delivery/packaging/assembly technology kind of a joke.


George
Jackson Park
on Jan 10, 2020 at 1:05 pm
George , Jackson Park
on Jan 10, 2020 at 1:05 pm
7 people like this

Rubbish pizzas made by robots!


Zoom
another community
on Jan 10, 2020 at 1:13 pm
Zoom, another community
on Jan 10, 2020 at 1:13 pm
2 people like this

The quality was very hit or miss. I noticed if I ordered a pizza at lunch time it had more toppings and arrived hot whereas orders placed in the evening were frequently skimpy on the toppings and arrived cold. Then they decided to no longer provide lunch offerings in Palo Alto and I stopped ordering altogether. It would have been a sustainable business model if they had focused more on quality and customer satisfaction.


USA
Old Mountain View
on Jan 10, 2020 at 2:50 pm
USA, Old Mountain View
on Jan 10, 2020 at 2:50 pm
14 people like this

The pizza delivery business is a low-margin, high-competition business with no barriers to competition. There was no way that Zume could have ever been a multi-billion dollar unicorn regardless of the automation or quality of the pizza. This is just basic business math that VCs lost sight of.


SRB
St. Francis Acres
on Jan 10, 2020 at 2:55 pm
SRB, St. Francis Acres
on Jan 10, 2020 at 2:55 pm
8 people like this

What a colossal waste of money: $4B for disrupting the pizza making business (robots to make perfectly circular pizzas with perfectly distributed toppings?) and making pizza packaging more sustainable (Can't we already compost good old cardboard pizza boxes in Mountain View)?.

Imagine how many real world problems could have been solved with that much dough....


Engineer guy
Another Mountain View Neighborhood
on Jan 10, 2020 at 3:40 pm
Engineer guy, Another Mountain View Neighborhood
on Jan 10, 2020 at 3:40 pm
4 people like this

They tried to poach me, to run a team of engineers/technicians. What a joke, I told them that there was no way I could stand behind their "groundbreaking technology"


Martin Omander
Rex Manor
on Jan 10, 2020 at 3:52 pm
Martin Omander, Rex Manor
on Jan 10, 2020 at 3:52 pm
65 people like this

How about that; I didn't know they were based in Mountain View.

Minor note about the money "wasted" in this startup: the $4 billion number was someone's guess at how much the company might one day be worth, not the amount of funding they have burned through. The linked article says they were losing $50 million per year.

In hindsight it's easy to say that this business idea would never have worked because the margins are low. But many people said the same thing about AirBNB, Uber and Twitter. The only way to know for sure if a business idea is any good is to try it out. I have a lot of respect for people who are willing put in the hard work to do that.


KB
Blossom Valley
on Jan 10, 2020 at 4:09 pm
KB, Blossom Valley
on Jan 10, 2020 at 4:09 pm
9 people like this

Something these comments seem to miss is that the company itself isn't going under, and it isn't wholly going away. Only the actual food prep and delivery is. Zume as a company has some interesting IP, designs and patents, they developed to fuel the pizza business, and that's where a lot of the their money went. That's also where their focus will now be.

Valuations and funding aside, the money they have spent hasn't necessarily been "wasted", and I'd actually be interested to hear how this move affects valuation and funding. My guess is the outlook for Zume itself might actually be better after this move, even if it isn't for the couple hundred workers they just laid off.


Bill
Willowgate
on Jan 10, 2020 at 5:46 pm
Bill, Willowgate
on Jan 10, 2020 at 5:46 pm
7 people like this

Can we come up with a way to turn pizza boxes into Cat Scratchers? I buy them for my cat and they cost $7.99 minimum for a bunch of cardboard strips glued together and turned on their side. Highway Robbery!

:)


one time customer
Another Mountain View Neighborhood
on Jan 10, 2020 at 6:57 pm
one time customer, Another Mountain View Neighborhood
on Jan 10, 2020 at 6:57 pm
5 people like this

Their pizza dough was not fresh, the most critical part for making good pizza.


With all
Another Mountain View Neighborhood
on Jan 10, 2020 at 7:30 pm
With all, Another Mountain View Neighborhood
on Jan 10, 2020 at 7:30 pm
5 people like this

With all the anti-business laws there sure seems to be a lot of business and people leaving CA.


That MV Guy
North Whisman
on Jan 10, 2020 at 11:10 pm
That MV Guy, North Whisman
on Jan 10, 2020 at 11:10 pm
7 people like this

Best pizza in Mountain View is tiny Maldonaldos. In the 1970s it was microscopic D.J.s in a little hole in the wall downtown. The smaller the business, the better the food.

Robots, out. Stop taking jobs from people.


JNN
Another Mountain View Neighborhood
on Jan 11, 2020 at 7:24 am
JNN, Another Mountain View Neighborhood
on Jan 11, 2020 at 7:24 am
4 people like this

So many short-sighted comments. Zume was never about pizza.


Zume employee
Another Mountain View Neighborhood
on Jan 11, 2020 at 9:38 am
Zume employee, Another Mountain View Neighborhood
on Jan 11, 2020 at 9:38 am
6 people like this

Pizza was the experiment and was never intended to be there core of the company.

I'm so happy that the pizza is finally going away. We can actually focus on the good things the company is doing.


Eric
another community
on Jan 11, 2020 at 3:25 pm
Eric, another community
on Jan 11, 2020 at 3:25 pm
2 people like this

@JNN- they were about automating a very very specific part of the food industry. They were about logistics for delivering the food product produced by their specific automation. They were bad at both.

They weren’t about pizza as such, but they were about pizza specific process


Enthusiastic pizza eater
Another Mountain View Neighborhood
on Jan 12, 2020 at 4:38 pm
Enthusiastic pizza eater, Another Mountain View Neighborhood
on Jan 12, 2020 at 4:38 pm
4 people like this

Stop criticizing the pizza just for the sake of complaining. Zume pizza was way better than any of the surrounding areas, it had the best tasting crust and was never soggy, and the delivery was completely reliable except for maybe one or two times when it was a bit late. The price was also pretty good, and they also had coupons steadily streaming into our mailbox every month or so. Also keep in mind that in the evenings they had tons of customers so harder to deliver all of them straight out of the oven, etc. and they still did that fairly well.


DC
Sylvan Park
on Jan 15, 2020 at 6:07 pm
DC, Sylvan Park
on Jan 15, 2020 at 6:07 pm
3 people like this

FYI making the frozen pizza is almost all automation. It is then frozen not heated and delivered. So the Zume pizza study was to automate as much as possible. And reduce the human cost of $15 hour. Some how 250 people became involved, That would be 70 pizza parlors so I hope there were other workers at Zume but Quality control should always be one.


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