Toast, the restaurant-focused startup that developed a platform to allow restaurants to manage and grow their businesses, has raised $250 million in venture funding at a $2.7 billion valuation.
According to a report citing the company, the round was led by TCV and Tiger Global Management. Other investors that participated in the fundraising round include Bessemer Venture Partners and T. Rowe Price Associates funds as well as existing investors, noted the report.
Proceeds from the capital raise will be used to build technology to help restaurants market, recruit and improve efficiencies in operations. The startup is also using the funding to expand into more areas internationally, according to reports. When Toast previously raised funding in July it was valued at $1.4 billion. Since then it has expanded and now has tens of thousands of customers, helping drive the valuation higher.
Tim Barash, chief financial officer of Toast, told reporters the company has seen revenue increase 148 percent, but wouldn’t say if the startup is profitable. The CFO said Toast has been able to grow because around 70 percent of its employees have been involved in the food industry before coming on board. “I was first a busboy, and then I worked in pizza delivery for years,” he said in the report. “Seventy percent of our employees have worked at restaurants, including those in our product leadership, and that helps us understand the problem.”
Barash said funding will go to enhance all its existing features on the platform and to add more advanced features to address bigger issues customers are dealing with, including guest engagement and retention, finding better ways to recruit and retain workers and to improve the efficiency of operations. Reports noted Toast has pledged to spend $1 billion on research and development over the next five years to develop more hardware and software. Barash noted that while it has gotten interest from larger companies, it is focused on growing and remaining independent.