Investors avidly embraced the business concept: gleaming industrial kitchens in cities nationwide where chefs created thousands of gourmet meals to be whisked directly to customers’ doors.

Everyone eats, every day, so the market is gargantuan, the financiers reasoned. Silicon Valley know-how and economies of scale would catapult Food Delivery 2.0 far beyond pizza and Chinese food. Tech-enabled takeout would transform people’s lives, freeing up their time while giving them healthy, delicious meals on demand.

That was the vision for San Francisco’s Munchery, which abruptly closed last week after raising — and apparently eating up — more than $125 million in venture capital. Munchery, once thought to be worth as much as $300 million, was the latest and biggest on-demand food company to fail. Another industry titan, San Francisco’s Sprig, closed in May 2017 after burning through some $57 million. Other failed tech companies that tried to both prepare and deliver food include Maple, Spoonrocket, Bento and Pronto.

Interviews with insiders at Munchery and Sprig reveal that the founders’ eyes were bigger than their stomachs. They had vision but flawed execution. They lacked food-industry experience, leading to costly waste. Consumers capitalized on promotional offers but never became repeat customers.

“The very first day I got there, I walked in and got the lay of the land, and was like, ‘This is not going to last; this is so mismanaged,’” said Amy Machnak, who worked as a content manger at Munchery for two years, writing mouth-watering descriptions of dishes like char-grilled Atlantic salmon filets with horseradish-spiked crushed potatoes.

Landing those dishes on plates was harder than writing about them.

“They didn’t get the logistics down,” Machnak said. Munchery and its founders and board members did not respond to requests for comment.

Pascal Rigo, a celebrated chef whom Munchery hired as its chief customer experience officer, had a more diplomatic take.

“The idea was very exciting and a big proposition,” he said. “But not only Munchery but everyone in this category that wanted to manufacture and deliver their own food to customers had difficulties. It’s very complicated. You can be either a good food company or a good delivery company, but I don’t think anyone has been able to do both.”

As with many startups, all that venture capital backing was a double-edged sword. It pushed Munchery to seek massive growth so it could rush to Wall Street for an even bigger cash infusion and for its investors to cash out. The lure of a dazzling initial public offering spurred it to pursue growth at all costs, even as it began to realize that many customers would order only when they got special promotions that were subsidized.

“They were chasing every avenue to put something out in front of customers in hopes of them buying,” said a well-known chef who worked at Munchery for almost two years, and asked to be anonymous to avoid burning bridges in the tight-knit culinary world. “It was more out of desperation than having it be planned and strategic.”

Rigo, who joined Munchery in late 2015, left the company after just five months.

Munchery realized that its original heat-and-serve meals were geographically constrained; They had to be delivered within a short drive of its kitchens. So it accelerated its expansion by setting up expensive production kitchens in Los Angeles, New York and Seattle, only to close them in May, axing 257 people, almost a third of its workforce.

It added meal kits which could be shipped out to a broader territory. It set up a kiosk at the Montgomery Street BART Station for grab-and-go take-home. It added a subscription service to show that it had a reliable amount of money coming in. “But people don’t want a membership; they just want to figure out what’s for dinner tonight, not six months from now,” Machnak said.

A longtime restaurateur, Rigo wanted to make sure Munchery’s model worked at a small scale before expanding it. “I couldn’t understand why we weren’t just focusing on San Francisco and doing it right before going to Seattle and Los Angeles and New York City,” he said. “I was not comfortable with the overall strategy. It really needed validation at the city level, at the concept level, before going anywhere else.”

Vying with services like UberEats, DoorDash, Postmates and Grubhub, which deliver a breathtaking breadth of cuisines from scores of existing restaurants, was a Sisyphean endeavor.

“We tried to have all this variety available at all times, but we couldn’t compete against delivery services aggregating from many different suppliers,” said the Munchery chef who requested anonymity. “It was a vicious cycle.”

Sucharita Kodali, retail analyst at Forrester Research, said Munchery and other companies with dedicated kitchens could not measure up against delivery services with restaurant deals.

Services like UberEats and DoorDash “have not just 17 but 1,000 entree options; almost any restaurant you want; a lot more choice — and the food is delivered hot within 30 to 60 minutes,” she said. “That’s a better value proposition.” (Munchery delivered its meals chilled for reheating.)

But if Munchery tried to expand its selections, “too much variety creates an operational control nightmare and quality control issues,” Kodali said. Companies that both prepare and deliver food, such as Domino’s Pizza, “work best because the menu has a small number of items, and there’s a finite delivery zone.”

Nate Keller, who was founding executive chef at Sprig and worked there two years, said that founders of the centralized-kitchen startups were “non-food people” who were willing to see meal quality degrade in pursuit of rapid growth.

“Food is so visceral to the human experience; once you’ve lost a customer, you’ve probably lost them forever,” he said. “As delivery times got pushed lower and lower, they looked for new ways to extend the life of food — and it just doesn’t work. People notice. I was not listened to when I said we cannot hold food hot for this long. If you take shortcuts and make exceptions for food quality, that’s the beginning of the end for a food business.

“That’s exactly what happened with every one of these businesses,” he said.

Waste was a big issue. Sprig would make meals to be ready for demand it could not predict. By contrast, physical restaurants have a better handle on quantities: They can see customers walk in.

“With almost every other industry, you can get economies of scale with growth,” Keller said. “With food, you can’t. If unit economics don’t work, they will never work. You have to have metered, deliberate growth.”

“Thanksgiving was a disaster; we thought we’d sell all these turkeys, and we didn’t,” the anonymous Munchery chef said.

Did Munchery ever eke out any kind of per-meal profit? The chef laughed.

“The numbers just weren’t there; there wasn’t enough margin to make it work,” he said. “To be honest, it was a house of cards.”

Carolyn Said is a San Francisco Chronicle staff writer. Email: csaid@sfchronicle.com Twitter: @csaid