Venture Capital: Restaurant Software Maker Toast Raises $400 Million

February 18, 2020 | News, Venture Capital
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Since last funding, the startup nearly doubles its valuation to $4.9 billion

Restaurant POS maker Toast scooped up $400 million at a valuation of $4.9 billion in its latest funding round. Toast will use the funds to invest in the development of new products on its technology platform including hardware and software. It will also hire hundreds of new employees.

Investors in the latest round of funding included Bessemer Venture Partners, TPG, Greenoaks Capital, and Tiger Global Management. (Crunchbase News)

Toast’s technology platform combines restaurant Point-of-Sale, front of house, back of house and guest-oriented technology with a varied marketplace of third-party applications.

Solid growth rate

Toast claims to be the fastest-growing restaurant management platform in the U.S; during 2019 the startup grew its revenues by 109% as “tens of thousands” of restaurants signed up for its products. According to ZDNet, over a dozen restaurants join Toast every hour.

“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,” said Chris Comparato, CEO at Toast, in a statement.

Durable Capital Partners LP, TCV, funds, and accounts advised by T. Rowe Price Associates, G Squared, Light Street Capital, Alta Park Capital, and other investors also participated in the round.

Toast currently employs about 3,000 people but is yet to report a profit, according to Bloomberg.

It previously raised $250 million from investors in April 2019 at a valuation of $2.7 billion.

IPO Plans in flux

“I think in the next few years it will be a goal to go public,” chief financial officer Tim Barash said Crunchbase. “I think when that is will depend on market context and focus for the Toast team.”

“We’re at the stage when companies would consider going public, but we’re not in any rush yet,” Toast Chief Executive Officer Chris Comparato said in an interview with Bloomberg. “Going public is a milestone and we want to have certain projects under our belt as a private company.”

Related Story: Celeb Chef Gordon Ramsay Inks PE Deal to Expand Across America                                                  

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