New Vending Startup Takes Aim at Mom-and-Pop Corner Stores

SAN FRANCISCO — The competitive landscape just got a little more crowded.

Two former Google employees, Paul McDonald and Ashwath Rajan, have joined to start Bodega with the aim of bringing the corner store to the consumer.

"At Bodega, we're combining the convenience of online ordering with the instant gratification of real world retail. We're building hardware, software and supply chain operations to create delightful automated stores that are only a few feet away and always stocked with what you need," the company stated on its website.

According to a blog post on the site, McDonald explained that retailers — both brick and mortar, and online — have been in a race to get products from a distributor to consumers as quickly, and cheaply, as possible.

"This is known as the 'Last Mile' of retail, and the whole retail industry is currently obsessed with optimizing it. It takes online retailers several days for their delivery networks to bring packages to your home  —  in the best case you have to wait hours," McDonald wrote. "Traditional retailers, on the other hand, rely on people getting themselves to the nearest store to purchase what they need."

In metropolitan areas like New York, corner stores fill that immediate need. But not all consumers have a corner store nearby. Bodega looks to fill that space.

"With Bodega, we're bringing that same ease and convenience to those of us that don't have a corner store by putting one right where you live and work," he wrote. "We've created small, automated stores stocked with the essentials you need, right where you need them  — whether it's snacks at the gym or toiletries and household goods in your apartment's lobby."

To date, there are 30 live Bodega locations in the San Francisco Bay area, he added.

The startup has raised some concerns, mainly that it was trying to put mom-and-pop retailers out of business. However, McDonald said that was not the goal.

"Challenging the urban corner store is not and has never been our goal," he wrote in a follow-up blog post.

"Corner stores have been fixtures of their neighborhoods for generations. They stock thousands of items, far more than we could ever fit on a few shelves. Their owners know what products to carry and in many cases who buys what. And they're run by people who in addition to selling everything from toilet paper to milk also offer an integral human connection to their patrons that our automated storefronts never will," McDonald said.

Bodega, he explained, wants "to bring commerce to places where commerce currently doesn't exist. Rather than take away jobs, we hope Bodega will help create them. We see a future where anyone can own and operate a Bodega  —  delivering relevant items and a great retail experience to places no corner store would ever open," according to the post.

Bodega has also stirred up some controversy with its name. Acknowledging that the company did not fully understand potential reaction to the name, McDonald said the company chose Bodega in a nod of admiration to local corner stores.

"The name Bodega sparked a wave of criticism on social media far beyond what we ever imagined. When we first came up with the idea to call the company Bodega we recognized that there was a risk of it being interpreted as misappropriation. We did some homework — speaking to New Yorkers, branding people, and even running some survey work asking about the name and any potential offense it might cause. But it's clear that we may not have been asking the right questions of the right people," he wrote.

"Despite our best intentions and our admiration for traditional bodegas, we clearly hit a nerve this morning, and we apologize. Rather than disrespect to traditional corner stores — or worse yet, a threat  — we intended only admiration," McDonald added. "We commit to reviewing the feedback and understanding the reactions from today. Our goal is to build a long-term, durable, thoughtful business and we want to make sure our name  —  among other decisions we make —  reflects those values. We're here to learn and improve and hopefully bring a useful, new retail experience to places where commerce currently doesn't exist."

For a close-up view of how Bodega works, click here.