- Since June, Zume Pizza, a SoftBank-backed startup valued above $1 billion, has lost several high-ranking executives, Business Insider has learned.
- The startup was developing a robotic arm to make pizza more efficiently when it took on $375 million in funding from SoftBank’s private equity fund in November 2018. The round valued Zume higher than the most popular pizza chains in the United States combined.
- According to people familiar with the matter, Zume executive Kartik Ramachandran, who served as interim CFO and in other high-level roles, was terminated in June.
- Kira Druyan, the General Counsel, departed in October, as did Susan Alban, the VP of Talent.
- The company touted its food trucks and food packaging products, but made no mention of its robotic pizza machines in response to a Business Insider inquiry.
- Click here for more BI Prime stories.
Zume, the Silicon Valley startup developing pizza-cooking robots, has seen a raft of high-level departures and growing internal doubts about the company’s shifting direction, Business Insider has learned. The turmoil comes as the company, valued at more than $1 billion, is reportedly in talks with SoftBank for another mega-funding round.
Kira Druyan, Zume’s company’s general counsel, and Susan Alban, the executive in charge of human resources and recruiting, both left last month, according to sources familiar with the matter.
Those exits followed the departure in June of Kartik Ramachandran, a high-level executive who held various roles at Zume, including interim CFO and President of Zume Source. Ramachandran was terminated after repeatedly butting heads with management and employees across the organization, multiple sources told Business Insider.
Meanwhile, the futuristic robo-pizza making machines that Zume touted when it came on the scene a few years ago appear to no longer be a priority.
The company also makes compostable packaging that Pizza Hut uses, and also has a fleet of food trucks dubbed “mobile kitchens” that it says it says include “intelligent software” and connected appliances.
Several people close to the company told Business Insider that Zume was spending money aggressively on hiring and was meandering between various projects and strategies, even as progress on its ambitious robotics technology appears to be stalled.
Zume’s business model seemed to fluctuate according various executives’ whims, often changing week-to-week or even day-to-day, sources said.
Asked about the status and advances in the development of the company’s robotic pizza makers, a Zume spokesperson said in a statement that the company’s mission is to “engineer a more successful sustainable food future.” The statement mentioned Zume’s packaging and its mobile kitchens, but made no mention of the robots.
The spokesperson confirmed the executive departures, but declined to comment on the reasons for any of the departures.
“The Zume team members all left for various personal reasons. Out of respect for their privacy, we will not disclose the specific personal nature of their departure. We’re grateful for their contributions and the stellar team here at Zume is looking forward to building on their accomplishments,” Zume said in a written statement.
“We were nowhere near doing what we were supposed to be doing”
According to a report in Recode on Thursday, Zume is once again in funding talks with SoftBank and other potential investors for a new round of funding that could value the company as high as $4 billion. The report noted that SoftBank, which has suffered huge writedowns on investments in Uber and WeWork, might not lead the next round in Zume and the funding might involve taking some debt.
The company’s first funding deal with SoftBank in 2018 was brokered in large part by Ramachandran, the former interim CFO, who was eager to secure what he thought could be the biggest Series C deal in history, sources said.
The $375 million investment valued Zume at $1 billion and was based on aggressive growth projections.
“My understanding was that we were nowhere near doing what we were supposed to be doing,” a source said of the actual capabilities of Zume’s technology and business versus what was promised at the time of the SoftBank funding.
Zume’s struggles to meet some of those promises caused friction between Ramachandran and others, sources told Business Insider, noting that Ramachandran frequently bullied, demeaned, and undermined those who spoke up.
“A third of the people liked him, a third hated him, and a third were terrified of him,” the source said.
Ramachandran, who is now Deputy CFO at Splunk according to his LinkedIn bio, did not immediately return a request for comment. Meredith Whitney, a former financial analyst, took over the CFO job in April, according to her LinkedIn profile.
The whiplash from the shifting strategies has led to underdeveloped tech, strained resources, and low morale overall, sources said.
Accepting the money from SoftBank was like “pouring gasoline on a fire,” the first source said.
Do you work at Zume or another SoftBank-backed startup and want to share your story? Contact this reporter via encrypted messaging app Signal at +1 (331) 625-2555 using a non-work phone, email at mhernbroth@businessinsider.com, or Twitter DM at @megan_hernbroth.
Leave a Reply
Leave a Reply
This site uses Akismet to reduce spam. Learn how your comment data is processed.
