Restaurant point-of-sale (POS) software provider Toast said it would have to cut about half of its staff — about 1,300 people — as the coronavirus shutters businesses nationwide, according to a CNBC report on Tuesday (April 7).
“During the month of March, as a result of necessary social distancing and government-mandated closures, restaurant sales declined by 80 percent in most cities,” Chris Comparato, chief executive officer of Toast, said in a blog post. “This is a massive disruption that hit the industry virtually overnight. Many restaurants that have temporarily closed may never reopen.”
Based in Boston, Toast provides POS technology that helps eateries maneuver from dine-in to takeout. But the company said it “took a huge revenue hit” when eateries shuttered. They decided to provide the package at no charge for three months.
Founded in 2012, Toast helps new and upscale restaurants update their technology. The startup raised $400 million in February and revenue nearly doubled in 2019. It is valued at almost $5 billion.
“There is no playbook for navigating a global pandemic, but at Toast we will double down on our effort to support our community and become the leading platform for restaurants of all sizes,” Comparato wrote on Tuesday. “We will continue to invest in our team, our platform, and — most importantly — our customer community.”
Some employees posted on LinkedIn on Tuesday that they’re job hunting. An international student here on a visa wrote that “losing my job at a critical time like this could mean effectively ending my career in the U.S.,” according to the report.
Toast is just one of many startups suffering from the economic impact of the global pandemic. Fitness startup ClassPass is reducing its staff of 700 by 50 percent. Luggage startup Away is following suit, laying off 10 percent of its staff and furloughing 50 percent.
Restaurants have been particularly hard-hit by the economic fallout of the coronavirus due to lack of consumer demand combined with the forced shuttering of restaurant dine-in establishments. Now that most people are working from home or not working at all, there is no lunchtime crowd for traditional restaurants and quick-service restaurants (QSRs).