- Toast is reportedly considering going public either through an initial public offering, which would value the restaurant technology company at about $20 billion, or a sale or combination with a special purpose acquisition corporation, The Wall Street Journal reports, citing people familiar with the matter.
- Toast said it doesn't comment on speculated financial transactions, but remains "laser-focused on supporting the restaurant industry as it recovers from the COVID-19 health crisis."
- The publication states there is no guarantee Toast would pursue these strategic options. But if it did go public, it would become one of the largest restaurant technology companies to do so within the last few months, following DoorDash's December IPO, which was valued at nearly $40 billion.
The momentum Toast built up last year could create additional interest from investors and allow it to further innovate and market its products in a competitive POS environment, which consists of over a dozen companies.
Toast was valued at $4.9 billion about a year ago following a $400 million round of fundraising that included Bessemer Venture Partners, TPG, Greenoaks Capital and Tiger Global Management. If its current valuation sticks, Toast would potentially debut at a much higher price than one of its closest competitors, Square, which went public in November 2015 through an IPO valued at $2.9 billion.
While the early months of the pandemic were tough on Toast, which laid off or furloughed about half its staff in early April, the company bounced back as restaurants switched to takeout and turned to Toast to help with this transition. Toast also provided over $40 million in financial support to restaurants through various offers, including free software, software-as-a-service relief and access to capital.
The company processed nearly 50 million guest orders between March and December through its digital ordering technologies, according to a press release. Full-service restaurants were among the top adopters of online ordering last year, with 51% of fine dining, 42% of casual dining and 41% of family dining operators saying they added the channel during the pandemic, according to the National Restaurant Association's 2021 State of the Restaurant Industry report.
Toast also added contactless payment methods last year, which were adopted by almost 25,000 restaurants in 2020. About 40% of restaurant operators added contactless or mobile payment options last year since March, bolstered by the 29% of customers who said they would pick a business that offered contactless or mobile payment over those that didn't, according to NRA's report.