Boston, Massachusetts-based restaurant management platform Toast has announced it raised $250 million in Series E funding at a $2.7 billion valuation. This round of funding was led by TCV and Tiger Global Management. Existing investors including Bessemer Venture Partners, Lead Edge Capital and funds and accounts managed by T. Rowe Price Associates also participated in this round.
Toast’s technology platform combines restaurant point-of-sales, front of house, back of house, and guest-facing technology with access to third-party apps. “Last year we celebrated the five year anniversary of our first Toast customer, Barismo. Now with tens of thousands of restaurants powered by Toast – and nearly 1,500 employees serving our community – it’s impressive to see how far we’ve come,” said Toast CEO Chris Comparato in a statement. “At our core, we believe every restaurant should benefit from the massive investment we continue to make in restaurant technology.”
Toast saw rapid growth as revenue increased 148% last year and this enabled the company to become the leading restaurant management platform for restaurants of all sizes. In conjunction with this funding round, TCV general partner David Yuan is joining Toast’s board of directors. Over the past year, the number of restaurants that selected Toast more than doubled. Brands like José Andrés’ ThinkFoodGroup Tartine Bakery, Joe Coffee Company, Eggs Up Grill, JACKS Urban Eats, and The County Line are now using Toast.
“At TCV, we invest in companies that have the potential to reshape entire industries. By providing restaurants of all sizes with access to innovative technology, Toast is leveling the playing field and leading the industry’s transition to the cloud,” added Yuan. “Our investment will enable Toast to extend their platform beyond point-of-sale and guest-facing technology, and in doing so, create a powerful SaaS platform with a superlative business model. We’re excited to partner with Toast as they accelerate the growth of the community they serve.”
Going forward, Toast is going to invest over $1 billion in research and development over the next five years in order to continue building software and hardware designed specifically for the restaurant industry. And with the Series E funding round, Toast said it will solve some of the most pressing challenges like enaging and retaining guests, recruiting talent, and improving operations and increase profitability.
Guests spend tens of billions of dollars at restaurants powered by Toast. And some of them use solutions like Toast Go and Toast Guest Feedback to accelerate the speed of service by up to 40%, increase revenue, and capture guest feedback in real-time. Toast plans to add new guest marketing capabilities this year to enable restaurateurs to deliver highly personalized offers and campaigns triggered by guest behaviors.
With Toast Point of Sale, restaurants are benefitting from higher sales, increased tips, and lower staff turnover. Broad Street Baking saw staff turnover decrease as tips increased by 58%. And now products planned for this year will simplify back-office operations and arm restaurateurs with tools for recruiting, hiring, and retaining talent in a competitive labor market.
Currently, the Toast Platform processes more than 2,500 requests per second across tens of thousaands of restaurants. Using Toast Reporting and Analytics, restaurateurs are able to monitor the performance of their businesses in real-time. This year, Toast is planning to provide restaurants with access to new reporting capabilities and insights.
“As we outgrew our legacy point-of-sale-system, we needed a cloud-based platform to build our business on. With Toast, we’re not only processing orders faster, but we’ve also seen aspects of our business like catering and delivery grow by more than 50 percent,” explained Jeffrey Pandolfino — who is the owner and a board member of Green & Tonic (five-location café in Connecticut).
