Restaurant Incubator Pilotworks Suddenly Shutters, Abandoning 175 Vendors

Restaurant and food product incubator Pilotworks abruptly halted operations this weekend — cutting 175 local food vendors from their products and leaving them without a kitchen ahead of a busy holiday season.

The company, which has high-profile investors like the founders of Sweetgreen and Blue Hill co-owner David Barber, shuttered its Brooklyn-based kitchen space on Saturday. Members were barred from accessing their ingredients, inventory, resources, and equipment as of 5 p.m. that day, according to a news release sent by a coalition of businesses that operated from the space.

In an email sent to the businesses Saturday evening, Pilotworks announced it was unsuccessful in securing the “necessary capital to continue operations,” adding that its only option was to cease all operations “immediately.” (Less than a year ago, Pilotworks announced a $13 million investment.) The email states that all kitchens were set to permanently close on October 13 at 5 p.m.

But vendors tell Eater that the company left them in the lurch. Lani Halliday of Brooklyn’s Brutus Bakeshop says she received the email nearly two hours after the supposed closing time. “They gave members just a few hours to collect their stuff,” Halliday writes in an email to Eater.

Pilotworks told its members that staff would be present Monday through Wednesday to facilitate the pick-up of equipment and food items left in the kitchens. All future classes and events have been canceled, the email states.

Anjali Bhargava of Brooklyn-based Bija Bhar, which makes an organic turmeric elixir, was also given late notice, according to a post she wrote on Facebook. “They not only failed to give us notice, they let all the staff go yesterday and shut the gas off and forced people out who had food on the stoves and in the ovens for events and markets this weekend,” she writes. Many of the businesses were gearing up for the holidays, a time that represents a good chunk of small food vendors’ annual sales, she adds.

The incubator’s Brooklyn outpost was also home to Ube Kitchen, a vegan dessert vendor that already let its fans know via Facebook that it won’t be attending the rest of Smorgasburg’s food fest due to Pilotworks’ closure.

Pilotworks was launched in 2016 by co-founders Mike Dee and Nick Devane as a way for small food vendors and entrepreneurs to kickstart their businesses. It provided a flexible cooking environment by providing kitchen space and equipment for rent by the hour or month. About 70 percent of the food vendors operating in its kitchens were women- and minority-owned, according to a news release.

The startup had raised over $15 million over four funding rounds since its inception, according to Crunchbase, an industry data site. In December 2017, Pilotworks received a $13 million investment led by Techstars Ventures and Campbell Soup’s venture capital fund, Acre Venture Partners. Other investors backing the startup included David Barber, co-owner of Blue Hill; the founders of Sweetgreen; and Andy Appelbaum, co-founder of Seamless.

In March of this year, Pilotworks expanded to Newark, a move that was reportedly backed by the city’s Community Economic Development Corp., as reported by NJTV News. The company also operated kitchen spaces in Dallas and Chicago. In September, it shuttered its Providence and Portland locations, the Spoon reported, and the Newark outpost is now gone as well.

Earlier this year, the company began shifting its top-tier management: In June, co-founder and CEO Devane stepped down and was replaced by former COO Zach Ware in a switch-up meant to expand Pilotworks’ commercial kitchens and pivot focus to long-term initiatives, the company said at the time.

But those long-term initiatives didn’t pan out, and the company is now facing a messy closure. Pilotworks announced the news publicly on its website over the weekend. See the full statement below:

It is with a heavy heart that after failing to raise the necessary capital to continue operations, Pilotworks will cease operations on October 13th, 2018. We realize the shock of this news and the disruption it causes for the independent food community we were so honored to serve.

This is a sad outcome for Pilotworks, the makers in our kitchens, and independent food in general. We wish there was another option to continue operating. Sadly, there was not. The work the independent food community is doing is amazing and inspiring. We know it will live on and we are deeply sorry it will not be with Pilotworks.

Questions can directed to questions@pilotworks.com and we will make every attempt to answer them the best we can.

Regretfully,

Pilotworks

In light of the news, Hot Bread Kitchen announced Monday it was partnering with organizations around the city to connect the vendors to available kitchens, including its incubator in East Harlem.

Eater has reached out to Pilotworks for more information. Stay tuned.

• Pilotworks Shuts Down [The Spoon]