Travis Kalanick has quietly built a large food and convenience goods business across Latin America as the Uber founder seeks to capitalize on the region’s fast-growing e-commerce market.
The billionaire has rapidly expanded his US-based start-up CloudKitchens by buying and building local “dark kitchens” in Latin America over the past three years as part of an effort to build a worldwide network of distribution centers of food, using his construction experience. Uber Eats during his tenure as CEO.
Alongside the dark kitchen business, which buys properties to use as space to prepare delivery or take out, he has launched Pik N’ Pak. The business stores convenience goods, such as pet food and medicine, from almost 50 CloudKitchens locations in 11 cities in Brazil, Mexico and Colombia. As with kitchen operations, Pik N’ Pak goods are delivered to customers by local delivery app companies.
The connection between Pik N’ Pak and CloudKitchens, previously undisclosed, comes as part of a deliberate push to expand stealthily, with local entities kept away from the parent company to avoid being associated with Kalanick, according to three former -CloudKitchens employees, who spoke on condition of anonymity due to strict non-disclosure agreements.
“When you have a CEO as influential and controversial as Travis, he doesn’t want to associate the brand with him,” said a former manager who worked in CloudKitchens’ Latin American business.
It comes as Kalanick has quickly grown CloudKitchens globally since taking over the business in 2018 after it was ousted from Uber following a slew of scandals in 2017. CloudKitchens was valued at a reported $15 billion in November, following an $850 million funding round.
CloudKitchens has more than 4,000 employees worldwide, according to two people familiar with the business.
CloudKitchens declined to comment.
The secretive culture reflects Kalanick’s approach to business after his acrimonious departure from Uber. Employees are banned from mentioning that they work for the company on LinkedIn, instead listing the “stealth start-up” as their place of employment — a term usually reserved for companies that haven’t yet launched.
“This is related to how he was attacked in the past,” said a former senior employee at CloudKitchens. “The Uber situation was not pleasant for him. He wanted to grow up [CloudKitchens in Latin America]he didn’t want to attract too much attention, he wanted to dominate the sector.”
But people close to the entrepreneur said his approach risks stunting the company’s growth and bears the hallmarks of his time at Uber. Uber’s infamous company principles like “Always Be Hustlin'” are codified in CloudKitchens.
Former employees said divisions of the company were kept in the dark about related parts of the business, contributing to extremely high tenant turnover at its facilities.
“For me to grow, I need to understand how operations are growing, or how finances are growing,” one person said. “But it was very blurry.”
CloudKitchens employs about 500 people in Latin America, running roughly 70 locations, containing 1,800 individual kitchens, in eight countries, according to two former senior employees with direct knowledge of the company’s operations.
Pik N’ Pak uses excess space in the company’s kitchen facilities — such as in the basement or along aisles — to store convenience goods such as over-the-counter medications, pet food and sex toys. In promotional material, Pik N’ Pak says it offers retailers access to “millions of customers”.
Retail brands can rent shelf space and list their goods on Latin American food delivery apps like Rappi or Cornershop, which handle customer payment and delivery.
CloudKitchens’ growth in the region was fueled by at least two acquisitions. In 2020, the group acquired Mexico-based kitchen group Nano for a reported $20 million, according to data from PitchBook.
In 2019, in a previously unreported deal, CloudKitchens acquired Colombia-based kitchen business Cocinas Ocultas, founded the year before by Italian entrepreneurs Raffaele Sertorio and Edoardo Dellepiane.
The Cocinas Ocultas team was tasked with developing the CloudKitchens business across the continent. Under the Cocinas Ocultas brand, CloudKitchens now operates in Colombia, Peru, Costa Rica, Panama, Chile and Ecuador. In Mexico, the company trades as VirtualKitchens.
In Brazil, CloudKitchens operates as Kitchen Central and is the market leader, according to Renato Avó, grocery director at consultancy 360 Varejo. Spending on food delivery in the country rose by almost a quarter last year to US$40.5 billion ($7.8 billion), according to a study by GS&NPD and the Brazilian Foodservice Institute.
“Dark kitchen operations are expected to account for about 15 percent of this total,” Avó said.
But the rise of dark kitchens across Latin America has sparked controversy in certain cities. The spread in São Paulo, the largest city in the Americas, sparked opposition from residents living nearby, with signs against the new facilities popping up in well-heeled neighborhoods.
The municipality has proposed local regulation of dark kitchens and earlier this year imposed a temporary ban on the granting of new licences.
People have complained about the noises, the winds, the smoke and the motorbike riders – colloquially known as motorcycle paint — waiting outside to collect orders. One disgruntled local said his son had been nicknamed “ham” and bullied at school because of the smell on his clothes, according to Cris Monteiro, a city councillor.
She said the company had been in contact before the controversy erupted, but questioned its willingness to reach a compromise.
“I understand the position of the entrepreneur. They say they are legally established. For me, this answer does not show the desire to cooperate”, she added. “I don’t see that they want to solve the problem together with the community.”
A former senior employee for CloudKitchens in Latin America said the company had become more sensitive to local business practices. But others close to Kalanick warned that old habits could continue.
“The one thing Travis learned from his time with Uber is not to trust the press and not to trust venture capitalists,” said a former senior figure at the company.
