The Man Who Will Disrupt Casual Dining
Kimbal Musk sits down with FSR to explain his mission of bringing real food to Middle America—and his strategy to change the casual-dining segment as we know it.
Kimbal Musk leans in. He doesn’t sit across from you at the table; he pulls up a chair beside you. His eye contact is intense, his conversation impassioned. Distraction is not a word in his vocabulary—not when it comes to talking about real food for everyone and scaling menu innovation across his restaurant concepts.
No, distraction doesn’t exist—but disruption does. It’s in Musk’s genes. And now, as the founder of The Kitchen Restaurant Group—owner of restaurants The Kitchen, Next Door, and Hedge Row—he’s set his sights on disrupting the restaurant industry and the way America views food.
“I want to make a real difference in food—and that particular difference is bringing healthy, nutritious, delicious, real food across America,” he says. Step one in his plan? Turning the traditional casual-dining segment on its head through a portfolio of what he calls “urban casual” restaurants.
Casual Dining Disrupted
To understand the concept of urban-casual dining, Musk says to look at it from the perspective of the guest, not the industry. “First and foremost, urban casual is a high-energy gathering place,” he says amid the early-lunch crowd assembling at Next Door American Eatery in Stapleton, Colorado.
“Anything urban is higher energy. People may actually live in suburbia, but they don’t want to live in traditional suburbia.” He gestures to the neighborhood surrounding Next Door—a collection of dense apartments. “The old days where everyone had their McMansion, that lifestyle is not interesting anymore. People want to be able to walk across the street to this restaurant. They want to have a gathering space with friends and family, one where they don’t stress out about bringing their kids.”
It’s a space designed for everyone to have fun, from the rollicking music to the energetic bar to the board games conveniently placed on shelves inset into the walls. It’s also an answer to the struggling casual-dining segment, Musk says, one that is higher energy and has faster, tastier, real food, which is what he’s convinced is what the guest wants.
While the fast-casual industry has risen up as a way to serve real, affordable food to the masses—Musk points to Chipotle, a fellow Colorado-based brand, as an example—he believes the experience falls far short of a gathering place. And the food in traditional casual-dining restaurants, he adds, is simply not good enough. “Don’t blame people for not wanting your product if it’s not keeping up,” he says.
What truly distinguishes Next Door is its fresh, real food, delivered to the table with a speed that rivals any fast-casual concept, in a full-service setting that invites guests to linger and play, and at a price point that’s stamped with value. The average check, including an alcoholic beverage, rings in at $16.
While traditional casual-dining brands worry about turning tables, Musk is monitoring “fire times” throughout the day at Next Door locations. That fire time, he explains, is the minutes that pass “from when a waiter standing at the table has pressed go on the iPad to the time the food arrives at the table.”
And the numbers are impressive. “We have an average fire time of 5 minutes, and some fire times are 2 minutes. Five minutes is profound—and sometimes food arrives even before the waiter has left the table.”
Next Door is all about delivering “a full-service experience at the speed of the guest.” And if guests aren’t ready to order, there’s no pressure from Next Door to make them hurry.
Journey to Food
It was a long road that led Musk to innovating within the casual-dining restaurant sector. His story begins like that of so many chefs who grew up cooking for their families. But that’s pretty much where the similarities with other chefs end. Musk’s family includes brother Elon Musk, the billionaire founder of SpaceX and Tesla (whose boards Kimbal Musk sits on).
Musk’s journey took him from South Africa, where he was born, to college in Canada and through the dot-com boom in Silicon Valley (where he and his brother made more than a little splash with their technology ventures). Eventually it led him into a world of disillusionment before he found his home, and his mission, in the heartland.
“My family is very intense, so we never sat down and had dinner together unless I cooked,” he says. “When I did cook, the food was better, and my dad and my mother would say, ‘OK, Kimbal is cooking, we’re going to sit down and have a meal.’ I was glad to have that opportunity to share, because I’d get to have a meal with my family.”
And so it began, the conviction that food was as much about the moment of gathering as it was the taste on the plate. He also cooked for friends during his college years, when it was “making mac ‘n’ cheese taste good and different the third time in a week. But it was what we could afford, and I loved the gathering, the bringing people together over food.”
At 22, when he and Elon ventured to Silicon Valley, he struggled because the community didn’t understand food, he says. In the high-tech frenzy, food was more about efficiency than experience. He left tech for cooking school, attending the French Culinary Institute (now the International Culinary Center) in New York City, where he graduated just before 9/11.
“I lived very close to the World Trade Center, and the school sent an email asking anyone able to volunteer to please reach out to the fire department, or whoever it was in charge at that time, and volunteer to cook,” Musk recalls. “You had to have some training, which I had, and you had to live below the security line, which I did. And while there were millions of people trying to volunteer, very few would qualify. I was there volunteering and cooking every day for six weeks. It was amazing, one of the most wonderful ways to process the trauma of that experience, to be feeding the firemen as they worked in giant piles of melting metal.”
He worked in what had been a restaurant; the front was destroyed, but the back of house was intact.
“I consider myself very lucky to have been part of that, and it profoundly changed my view on the world. Where I’d been cooking as a hobby, I now wanted to make it my career. So I went traveling the country looking for a place to open a restaurant. I think subconsciously I wanted to get away from New York because of the trauma of 9/11, so I found Colorado and just fell in love.”
He opened The Kitchen in 2004 with business partner Hugo Matheson and his wife at the time, Jen Lewin. But in 2010, a serious snow-tubing accident left him paralyzed for days, and horizontal for months. He says he had an epiphany at this time, realizing that if he could return to health, he wanted to make bringing real food to everyone his primary mission. “After surgery, I woke up the next morning and I could feel my left hand and I could walk,” he says. “And I never looked back.”
The mission for real food for all and a disruptive urban-casual movement was off and running. And as he told The Wall Street Journal in May, “Food is the new internet”—an incoming wave of innovation that people don’t see coming, but which will change the world as we know it. Back in the early days of the internet, Musk and his brother built an online database of businesses, Zip2, which he likens to a digital version of the classic Yellow Pages. He compares that experience to what is to come with food.
“I visited the head of a major Yellow Pages company, and he literally threw the book at me and said, ‘You ever think you’re going to replace this?’ And I thought: He’s already dead. The Yellow Pages were already dead,” he says. “Now I see the same sort of thing in food.”
The traditional casual-dining segment is certainly part of that demise, in his perspective. But Musk believes that the overarching problem that needs to be addressed is America’s dependence on industrial food that is overly processed, highly caloric, and gives little, if any, regard to nutrition.
“Everything has been about getting the price down—who cares what the consequences are,” he says. “The promise of industrial food was cheap calories for all. We just didn’t realize that instead of cheap calories, we have extremely expensive calories in the form of obesity and diabetes. It’s a personal tragedy for the person whose life is destroyed, and it’s an economic tragedy for the country. No one wins.” Therein lies the heart of his mission statement: Real food as the solution, versus fake food creating the problem. “Restaurant groups or food businesses that still believe industrial food is the future, I think they are already dead,” Musk says. “If you don’t understand that you have to change, then you’re just going to be left behind.”
Need for Speed
Urban casual is Musk’s biggest commitment to creating that change. The first goal of urban casual, per its visionary, is to create that gathering place, and the second is to support it with technology that enables the restaurant to speed things up and make the food tastier.
“Speed and taste are critical,” Musk says. “Automation and digitization have made restaurant operations profoundly different today than it was just five years ago. Our front end is 100 percent digital.”
Taste is the bigger challenge. It starts with sourcing fresh, real ingredients in a “just-in-time” business model that would leave masters of supply chain and logistics begging for such a precise and predictable execution. Fresh food is delivered to Next Door seven days a week, before 8 a.m.
Besides a mini version for ice cream, Musk says, there are no freezers in Next Door. “We don’t fix anything and freeze it; we want to serve food as soon as it has arrived because it’s grown locally and really fresh,” he says. “Holding it for a few days is not good because it affects the taste. As soon as it comes in, we want food to go straight to the tables. It’s a just-in-time approach to real food.”
Managing this inventory flow internally is accomplished by not only having no freezers, but also by having walk-ins that are relatively small, thereby forcing the restaurant to use fresh food.
Local farmers can be a harder sell on this model, because delivery every day results in a difficult lifestyle for them; Musk says it requires building trust. “We also have local food hubs that help take the load off farmers by doing the deliveries seven days a week,” he says.
Consistency is critical, he says, so Next Door can ensure that a roasted vegetable salad in Memphis is as good as one served in Denver, even though ingredients might be slightly different. For him, consistency is the holy grail of scaling a concept. It becomes an issue of integrity and trust—trust from guests that they’ll be able to rely on every Next Door to serve fresh, real food that is nutritious and delicious.
Musk credits automation in the back of house for making the food consistently good across all of the locations. He lauds the efficiency of modern-day combi ovens from Rational that his team discovered in Germany. “We can code a recipe from our home office that will go to every oven in our restaurant group and perfectly roast cauliflower a certain way,” he says. “If we want to change it, all we have to do is program it from the home office.”
Musk points to cauliflower as an example of the power of automation. Cauliflower cooked incorrectly is a nightmare for all, especially the restaurant operators who disappoint guests with mushy, flavorless florets.
“The way you have to cook cauliflower,” he says, “is you have to boil it, then you have to bake it slowly to draw the moisture out so it dehydrates and concentrates the sugars. Then you have to roast it, and then you need to brown it a little bit. That’s a lot of steps—and even if you are told how to do it, as far as we’re concerned, it is two-star-Michelin-level cooking. Most cooks need 10 years of training to know how to cook cauliflower well. But using automation, we are now able—in one hour—to teach an 18-year-old how to roast cauliflower even more consistently than a Michelin-starred chef might do.”
As with all of the dishes at Next Door, only raw, fresh cauliflower is used, and it’s all scratch cooking. Young cooks have to be taught how to work with the head of cauliflower, how to consistently chop it so pieces aren’t cut too big or too small, and how to season it. But the rest is handled by automation.
“They put it in the oven without wearing gloves. The oven is coded to steam the cauliflower, draw the moisture out, bake it, then roast it, and then immediately cool the cauliflower down in the oven,” Musk says. “Then the 18-year-old takes it out, again without gloves on, and is ready to serve the cauliflower.”
Two years ago, Musk and his team realized that scratch cooking to scale would require technology providers that could help them succeed. The Rational ovens were added to Next Door less than a year ago, and already Musk describes them as a critical addition to the kitchen.
“It’s really good to have a technology partner like Rational; we’re aggressively trying to use their ovens as efficiently as possible so we can deliver scratch cooking as consistently as possible,” he says.
Deep in the Heartland
Musk aims to have 50 Next Door locations by the end of 2020, all in the Middle America region that he defines as being between Denver, Pittsburgh, Chicago, and Memphis. (Today, there are five Next Door locations in Colorado and one in Memphis, with another scheduled to open in Indianapolis early next year.)
“We think the heartland is a massively underserved market, with communities that want real food but that don’t get a lot of options,” Musk says. “And for us, from a mission perspective, it’s also where there’s a need.”
But serving those cities goes beyond simply opening restaurants there. Musk’s group has also developed resources designed to teach younger generations about the beauty—and business—of real food. He launched Square Roots, which is an urban-farming and entrepreneurialism platform that invests in young farmers; the first location is in Brooklyn, New York. And his Learning Gardens program provides elementary, middle, and high school students with hands-on, experiential learning in outdoor classrooms and vegetable gardens. There are 425 Learning Gardens in six regions—Chicago, Denver, Indianapolis, Los Angeles, Memphis, and Pittsburgh—reaching 250,000 students. The goal is to have 1,000 Learning Gardens across 10 regions by the end of 2020.
“We really go deep into communities; we’re not a believer in spreading this out over 100 communities. We want to pick 10 communities and go deep,” he says. “We want kids from elementary to high school to have a connection with real food, to understand what real food is all about—that it comes out of the ground, it tastes good, it’s nutritious, it’s important to trust your food, and you can trust food you’ve grown yourself.”
Learning Gardens participants are given the opportunity to be a Square Roots entrepreneur after they’ve graduated from high school.
Going deep into a community also means bringing each of his brands to bear. In addition to Next Door, the Learning Gardens, and Square Roots, Musk also owns The Kitchen American Bistro—his original restaurant that first opened in 2004 in Boulder and now has five locations—and his newest venture, Hedge Row American Bistro, which opened this summer in Denver’s Cherry Creek neighborhood. The Kitchen, with three Colorado units plus one each in Chicago and Memphis, is a high-end restaurant where the average check approaches $50. Hedge Row aims even higher, though it is too soon after opening to quote an average check. A second location is already in the works for Indianapolis.
In each of his brands, Musk holds true to his mission of serving real food that is fresh, nutritious, delicious, and locally sourced. Accomplishing that goal hinges on sourcing synergies created by opening both the high-end brands and the more affordable urban-casual brand in the same markets.
“The Kitchen enables us to support local farmers because it has a menu that can change every day, so we can work with farmers on a product that is really unique to the market,” Musk says. “With Next Door, we want to keep a simple, delicious, consistent menu that supports affordable pricing.” For instance, The Kitchen Restaurant Group purchases a whole cow, using the prime cuts at The Kitchen and Hedge Row and the burger beef at Next Door.
The Next Door in Stapleton opened in April, in a community that Musk notes is neither poor nor wealthy. “It’s a family community, so you need to deliver food that is affordable for middle-income people, and having a gathering place is very important. Eventually, we’ll have a Kitchen in this community as well, where we can charge higher prices. We won’t open as many Kitchen locations as Next Door, but we’ll have a lot of Next Door locations in the Denver market.”
In his estimation, the Denver metro area is an example of what other communities in the heartland will become. “When I moved here 15 years ago, Denver wasn’t the super-cool town it is today. Denver five years ago was like [Indianapolis] is today. I think cities in the heartland are going to come back big.”