Restaurant365 gobbles up $135M to supersize its software for the food service industry | TechCrunch (2024)

The price of food continues to go up and up, but surprisingly that hasn’t (yet?) played out as pressure on the wider restaurant industry. Now, a startup that’s building technology to serve that sector announced a supersized round of funding to nourish its growth.

Restaurant365, which develops all-in-one restaurant management software, announced $135 million in new funding co-led by KKR and L Catterton. Previous backers — specifically ICONIQ Growth and Bessemer Venture Partners — are also participating in this round, which brings the total raised by the startup to $288 million.

The company’s software, which covers accounting, analytics, staff and inventory management (but not point of sale solutions), is currently used in some 40,000 locations, with customers including small businesses, franchises and chains, and accounting firms that work with restaurants. It will be using the funding to continue developing product across all of those areas.

It’s not clear if Restaurant365 is profitable, but it’s currently making some $100 million in annual revenues, it said.

The company — based out of Irvine, California, and founded in 2011 — is not disclosing its valuation specifically, although a quote from CEO and co-founder Tony Smith notes that the company now has reached “$1 billion in value”. A spokesperson for the company has now confirmed to me that the enterprise value is, indeed, over $1 billion. That’s a big jump: according to data from PitchBook, Restaurant365’s valuation was just over $305 million in 2019.

The investors here are interesting and strategic: KKR and L Catterton, as PE firms, both have a number of holdings that extend into the food service industry; ICONIQ and Bessemer are more directly major VCs in the world of tech investing.

“R365 has achieved continuous, accelerated growth, which is a testament to our strong team who is eager to change the restaurant industry for the better,” states Tony Smith, CEO and co-founder of Restaurant365, in a statement. “Anytime we receive funding, we recognize it as a privilege. However, the primary driver of this round is uniting with two strategic investors so intimately tied to the restaurant industry. Having recently crossed exciting milestones of $100 million in revenue and $1 billion in value, we can’t wait for what’s next.”

The company’s funding injection is coming at a time when many believe that the global economy, and those of individual countries, are teetering on the brink of recession, as the world continues to recover from the COVID-19 pandemic and the shifts that it brought into how consumers make and spend money. But ironically, signals from those closely watching how restaurants are doing seem to point in a different direction.

The U.S. National Restaurant Association, in its annual state of the industry report (from February 2023), notes that while some of the headwinds of 2022 are continuing into this year, the food service industry is forecast to grow to $997 billion in sales this year, with 500,000 new jobs (to bring the total to 15.5 million by the end of 2023, post pre-pandemic levels), and a strong consumer desire to continue going to restaurants in their leisure time. Not all is totally rosy, though: The rising cost of food that’s driving those increased revenues, and the fact that there are more restaurants popping up (more jobs), means a lot more competition, too.

All of that, however, points to a wider base of potential users for companies like Restaurant365, along with the many others in the space that cater (sorry) to the same clients. They include Toast, Lightspeed and others like Square, PayPal and more. While a lot of the businesses serving the restaurant industry found themselves on their knees during the big pandemic shutdown, Restaurant365 emerged as one of the tech companies that was providing tools to help its customers weather the storm.

“Restaurant365 has demonstrated compelling growth throughout its history, now powering more than 40,000 restaurant locations,” said Jimmy Miele, director, Tech Growth at KKR, in a statement. “Moreover, their software has played a crucial role in helping many struggling operators keep their doors open during uncertain times. We look forward to being a part of this next chapter, helping even more operators achieve their highest potential.”

“L Catterton has deep experience investing in world-class restaurant brands globally,” added Ian Friedman, a partner at L Catterton. “With deep insight into the everyday pain points of restaurant operators, we believe Restaurant365 is the gold standard in the industry, helping to streamline operations and boost profitability, and we are proud to leverage our consumer and technology investing experience as a partner to Tony and the team.” Friedman is joining the board.

Updated with valuation information.

Restaurant365 gobbles up $135M to supersize its software for the food service industry | TechCrunch (2024)

FAQs

How much is Restaurant365 worth? ›

Restaurant365 Announces $135M Funding Round Co-Led by KKR and L Catterton. Leading restaurant enterprise management software company surpasses $1B valuation.

Is Restaurant365 profitable? ›

It's not clear if Restaurant365 is profitable, but it's currently making some $100 million in annual revenues, it said.

Who owns Restaurant365? ›

Tony Smith is Chief Executive Officer and a Co-founder of Restaurant365.

How many customers does Restaurant365 have? ›

Restaurant365 has 1,657 total employees and 41 sales reps that carry a quota. They have 12,000 customers an engineering team of 29 and a marketing team of 7.

What companies use Restaurant365? ›

Companies using Restaurant365 for Restaurant Management include: Freddy's Frozen Custard & Steakburgers, a United States based Leisure and Hospitality organisation with 9750 employees and revenues of $3.00 billion, California Pizza Kitchen, a United States based Leisure and Hospitality organisation with 15000 employees ...

What does Restaurant365 do? ›

Restaurant365 is the industry's leading all-in-one, cloud-based accounting, inventory, scheduling, payroll, and HR solution developed specifically for restaurants. The R365 platform simplifies day-to-day management for restaurant operators, allowing them to control food costs and optimize labor costs.

How do you get into restaurant365? ›

First, download the R365 App. Then, to login, enter the username and password provided. Then, tap login. Upon logging in, the mobile dashboard will load, where users can hours and upcoming shifts.

Can you become a millionaire owning a restaurant? ›

If we stick with that $2 million number, that restaurant owner making $200,000 on every $1 million, in five years would make $2 million. Plus add the equity from paying down the loans each one of those years, you can quickly see that, yes, you can get rich in the restaurant business.

What restaurant chain is the most profitable? ›

Domino's and Bloomin' Brands round out the top 10.
  1. Compass Group PLC. Revenue: $38.07 billion1. ...
  2. Starbucks. Revenue: $35.98 billion. ...
  3. McDonald's. Revenue: $25.49 billion. ...
  4. Yum China Holdings. Revenue: $10.98 billion9. ...
  5. Darden Restaurants. Revenue: $10.49 billion. ...
  6. Chipotle Mexican Grill. ...
  7. Yum Brands. ...
  8. Restaurant Brands International.

Is Restaurant365 an ERP system? ›

The company sells database software and technology, cloud engineered systems, and enterprise software products, such as enterprise resource planning (ERP) software, human capital management (HCM) software, customer relationship management (CRM) software (also known as customer experience), enterprise performance ...

Who is the new CFO of Restaurant365? ›

Katie Fairchild on LinkedIn: Restaurant365 Names Jessica Lanier Chief Financial Officer.

Who is the CEO of R365? ›

Tony Smith is the CEO and co-founder of Restaurant365, a company that's helping improve the fortunes of more than 40,000 restaurants with its back-office management software. The leader stands out for his commitment to transparency and desire to help businesses thrive.

What are the functions of Restaurant365? ›

What is Restaurant365?
  • Accounting processes.
  • HR and payroll.
  • Inventory.
  • Employee and staff shift scheduling.
  • Reporting.
Feb 23, 2023

Is Restaurant365 cloud-based? ›

Restaurant365 is an online, cloud-based restaurant management system that can help restaurant managers with all areas of management. Working online in the cloud means that editing the data and accessing operations tools from Restaurant365 can be done from anywhere.

How many waiters per customer? ›

Staffing Guidelines and Staff to Customer Ratios

Casual dining: One server for every five to six tables per shift and four back-of-house staff per 50 tables. Fine dining: One server for every three to four tables per shift and six to seven back-of-house staff per 50 customers.

Did Restaurant365 buy compeat? ›

Today, Restaurant365 announced the acquisition of Compeat, a well-known provider of restaurant back office, workforce, and business intelligence software.

Who is the richest restaurant owner? ›

Tilman Joseph Fertitta (born 1957) is an American billionaire businessman and television personality. He is the chairman, CEO, and owner of Landry's, Inc.

What is the net worth of the restaurant group? ›

Key Financials
Accounts20182022
Cash£65,903,000.00£27,700,000.00
Net Worth-£160,901,000.00-£224,100,000.00
Total Current Assets£128,589,000.00£60,500,000.00
Total Current Liabilities£226,197,000.00£218,000,000.00

How much is the restaurant market worth? ›

The National Restaurant Association is forecasting a record $1.1 trillion in sales in 2024 and the addition of 15.7 million jobs.

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