xtraCHEF Acquired By Restaurant Tech Unicorn Toast
Dive Brief:
Toast has acquired xtraChef, which offers back-office technology for restaurants, including accounts payable automation and inventory management, according to a press release.
Combining xtraChef's line item-level cost data with Toast's sales data will provide insights into profitability by menu item and automation and intelligence tools to streamline tasks like bookkeeping, managing inventory and tracking margins. XtraChef will become xtraChef by Toast, and xtraChef CEO and co-founder Andy Schwartz and CTO and co-founder Bhavik Patel will remain with the company in their existing roles.
The acquisition builds on Toast's strategy to expand its product offerings. In April, it added updates to its Order & Pay solution, which included pre-authorization tabs that let diners start a tab, pre-authorize a credit card from their device and order. The company also introduced estimated sales reports for Toast Marketing, Apple Pay and customizable bonus points for Toast Loyalty.
Dive Insight:
Toast has experienced quite a turnaround since the start of the pandemic. In April 2020, the company laid off half its staff after restaurant sales dipped 80% in March 2020 following lockdowns and dine-in closures. But from March to December 2020, the company processed 50 million orders through its digital ordering platforms, and 25,000 locations added Toast's contactless technologies, according to a press release.
Over a year later, the company is rumored to be going public and could be valued at $20 billion. An acquisition only solidifies its growth mode, which is likely being helped by restaurant sales that have risen over the last 11 weeks. Its current trajectory shows it is getting back on track to where it was pre-pandemic. In 2019, the company raised $250 million and acquired HR and payroll software provider StratEx.