Software and payments company SpotOn has raised $125 million in a Series D round that places it among the leaders in tech for restaurants and small businesses.
The round was led by prominent tech investor Andreessen Horowitz and included contributions from existing investors DST Global, 01 Advisors, Dragoneer Investment Group, and Franklin Templeton, as well as new investor Mubadala Investment Company. The investments raise the company's valuation to $1.9 billion.
SpotOn offers a full suite of restaurant tools including POS systems, online ordering, reservations, loyalty and data reporting. The all-in-one product is one thing that helps the company stand out in the increasingly crowded restaurant technology space, said co-founder Matt Hyman.
Other distinguishing factors, he said: A subscription-based, a la carte payment structure, and an intense focus on people and culture. The San Francisco-based company has five satellite offices strategically located to offer better customer support, for instance.
"We really try to do business with empathy," Hyman said in an interview. "That’s one of our core values, is keep it simple and be the merchant."
Aiding that mission is SpotOn's restaurant advisory council, a group that includes Michael Mina, Brent Bolthouse and Matthew Kenney, who provide an operator's perspective on product development. SpotOn was created by restaurateurs, too: Co-founder and Chief Product Officer Doron Friedman still owns the bagel shop he opened when he was 20—IV Bagel Cafe in Isla Vista, Calif.
The cafe, of course, uses SpotOn.
"It’s really helped our business grow dramatically, even during COVID," Friedman said.
SpotOn has about 30,000 customers, about 40% of which are restaurants. It has added 8,000 clients in 2021 alone, a number it expects to triple by the end of the year.
During the pandemic, tech tools like online ordering became a must for many restaurants, speeding up the pace of adoption by years. Some businesses coming to SpotOn are starting from the ground up technologically, while others are upgrading from older systems, Hyman said.
"A lot of our customers are coming with legacy systems where they want to level up" to a fully integrated system, he said.
Its customers generally have between one and 20 locations, though it does work with some medium-sized chains. Restaurants can pick and choose which SpotOn tools they want to use, with monthly subscriptions starting at $65. They must also purchase any associated hardware, such as printers and kitchen display systems.
SpotOn is not the only company to offer an all-in-one payment and software product for restaurants. Big names like Toast, Clover and NCR promise the same. But the company founded in 2017 does not feel like an underdog among those more established players.
"I don’t think we ever felt like an underdog," Hyman said. "I do think having someone like Andreessen Horowitz leading our Series D ... does cement the fact that we are leaders and we have a relatively robust road map ahead of us."
Andreessen is a past investor in Clover, and its current restaurant tech investments include All Day Kitchens and Allset.
SpotOn will use the funding to grow its staff and continue developing its platform, with new products already set to be unveiled.
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.