Toast will continue to invest in product development after its latest funding round, but CEO Chris Comparato said there are no plans to launch an IPO just yet.
Toast, a cloud-based restaurant management software company that recently opened a new office in Dublin city centre, has raised $400m in Series F funding, bringing the company’s valuation to $4.9bn.
The latest round of investment was led by Bessemer Venture Partners, TPG, Greenoaks Capital and Tiger Global Management, with participation from Durable Capital Partners, TCV, Light Street Capital, G Squared, Alta Park Capital and others.
Launched in 2013, Toast provides front-of-house, back-of-house and guest-facing technology to restaurants. The business, which is headquartered in Boston, saw revenue increase by 109pc last year, with tens of thousands of new restaurants adopting its technology.
Toast has developed a number of platforms to serve a variety of restaurant types, from fine dining and casual dining to fast-casual and cafés. The company now has more than 2,200 employees.
Plans for the funding
Chris Comparato, CEO of Toast, said: “As a result of our tremendous growth and commitment to the restaurant industry, we have continued to see a significant amount of demand from the investor community.
“As the clear platform leader in the restaurant space, we are excited to use this investment to extend our capabilities and drive a bigger impact for the restaurant industry.”
Toast said that it plans to invest proceeds from the fundraise into meeting the evolving needs of the restaurant industry. The company will invest in new products designed to deepen restaurateurs’ connections with guests, increase the speed of service, streamline the guest experience and reduce operational costs.
Toast will also invest in using its platform to improve the restaurant employee experience, with the aim of reducing employee turnover and addressing the labour challenges within the restaurant industry. The company will also invest in financial products that provide access to funding to help restaurateurs grow their businesses.
Kent Bennett, partner at Bessemer Venture Partners, said: “Just as the retail industry weathered disruption from e-commerce over the past two decades, restaurateurs now face shifting consumer expectations and a changing landscape of tech players who threaten to erode restaurant brands.
“Toast wants to partner with the restaurant community to level the playing field and strengthen this nearly trillion-dollar industry. We’re thrilled to continue to support this incredible team in 2020 and beyond.”
Valued at $4.9bn
Toast had been valued at $2.7bn in March 2019 after the company raised $250m in funding. At the time, the company announced plans to invest $1bn in research and development. Less than a year later, the company’s valuation has significantly risen.
Comparato remains committed to funding research and development. The CEO told Bloomberg: “We’re at the stage when companies would consider going public, but we’re not in any rush yet. Going public is a milestone and we want to have certain projects under our belt as a private company.
“We aren’t profitable yet, because we’re investing ahead because of the demand we see coming,” he added.
Meanwhile, Olo, another major player in the restaurant software space, is preparing for an IPO later this year, according to Bloomberg.
Toast’s presence in Ireland
At its new hub on Westmoreland St, Toast announced last year that it was planning to create up to 120 jobs in Dublin, with a heavy focus on product development.
The company was looking to hire for a number of roles in areas such as software engineering, data analytics, product design and software development.
At the time, Hugh Scandrett, senior vice-president of engineering at Toast, said: “The response to placing our first international office in Dublin has been positive and we look forward to growing our presence here.
“I look forward to expanding our team with talented people, and developing products that will be central to Toast’s growth in the coming years. Dublin is a recognised technology hub in Europe, which makes it the right location for our investment in this great new office.”