Here at TechCrunch, we’ve been big fans and customers of ZeroCater, the Y Combinator-backed company which seeks to reduce the hassle of providing lunch to your employees. Billed as a kind of Pandora for office lunches, ZeroCater maintains a list of high-quality restaurants, caterers, and even food trucks to bring good food to hungry teams of workers.
Until recently, ZeroCater was only available in the San Francisco Bay Area, but that’s changed, as the startup has just launched service in New York City. There, it hopes to capture customers in what is the largest corporate catering market in the United States.
“As we were thinking about where to go next, we decided that New York had a lot of good food and a lot of good companies that want to be there,” ZeroCater CEO Arram Sabeti told me. It’s been looking to get high-quality vendors on board, those that are well known or maybe have achieved some degree of cult status in NYC.
While they can be skeptical at first, especially if they haven’t done a whole lot of corporate catering before ZeroCater, the company has been working to convince them that it can contribute a significant portion of additional recurring revenue to them. So far more than 30 restaurants have signed up.
But before introducing services in its second market, the ZeroCater team talked with other startups who had successful launches — startups like Uber, which is now in dozens of cities around the world. Like them, ZeroCater sent an advance team to New York City to find vendor partners and to start signing up its first customers. They were also in charge of hiring the company’s first employees in the city.
ZeroCater lunch evangelist Casey Bertenthal was part of the NYC launch team, working to sign up clients in the city. He said it can be a bit of a tightrope to balance supply and demand there, as the startup made sure it had enough vendors to serve the growing client base. Even so, all the work that ZeroCater had done over the past few years to perfect its business in the San Francisco Bay Area has paid off.
“We waited as long as we did because we wanted to replicate our success someplace else,” Sabeti said. “We didn’t want to replicate our mistakes, but really wanted to understand what we were doing first.”
As a result, Bertenthal said the New York launch was surprisingly seamless. ZeroCater has been targeting companies which were already providing lunches to employees at least a few days a week. The startup had a waiting list of companies that were interested in signing up for its service there, including some which had offices in San Francisco but hadn’t found a comparable service there.
That includes companies like Foursquare, which is now a ZeroCater client in both San Francisco and New York. Buzzfeed and Tumblr have also signed up as customers in New York City. And so far, it’s had a 100 percent retention rate there.
The ZeroCater team isn’t just looking to capitalize on the size of the New York market, but it’s also trying to introduce a bit of its own corporate culture there. While New York City has a thriving corporate catering market, to the tune of about $20 billion, according to Sabeti, there’s a bit of an “eat at your desk” mentality there.
Steffi Wu, the company’s director of PR and marketing, says that ZeroCater is “all about building good relationships over food, and bringing that to other companies.” The folks at ZeroCater strongly believe in teams eating together — which is one reason why many of its choice vendors serve up buffet-style lunches that are shared rather than just dropping off individual sandwiches for employees.
Just as in San Francisco, there is a limit to the size of the company that ZeroCater will serve. Customers must have at least 10 employees to feed a couple times a week. And while startups have been early adopters, in part because they’re part of ZeroCater’s network, the company is doing more and more business feeding non-tech businesses.
ZeroCater famously started as just one guy with a big-ass spreadsheet. But with its expansion into New York City, ZeroCater now has a total of 34 people. The NYC launch team is about six people currently working to grow the market, with two employees who will continue to work there full time. And it’s still looking to hire there.
All in all, the company seems to be doing pretty well for itself, as it’s still working off of $1.5 million in seed funding that it raised in August 2011 from investors that included Keith Rabois, Paul Buchheit, Vaizra International, Yuri Milner & Felix Shpilman, SV Angel, Start Fund, Stewart Alsop, Justin Kan, Emmett Shear, Othman Laraki, Gabor Cselle, Mark Friedgan, Alexander Goldstein, and Starling Ventures.