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Toast lost 80 percent of its revenue to the virus, however, being able to file an IPO was a silver lining for its operations.
Toast, a large chain of restaurant cum technology company, has become the biggest in the restaurant-tech sphere since its shares were sold for $40 per share at its IPO. While the news is yet to be made public, a CNBC report revealed that the valuation of the restaurant-tech company Toast has risen to $20 billion.
The company, which will appear with a “TOST” symbol on the New York Stock Exchange (NYSE), had earlier expected its shares to sell for $36 each but was met with a surprise when investors began to price it above the initial price.
Like every other business, the pandemic had a negative effect on Toast as it was forced to most of its branches whilst also resizing its workforce. The company also lost 80 percent of its revenue to the virus, however, being able to file an IPO was a silver lining for its operations.
Immediately, the lockdown was lifted, most tech companies like Airbnb, TripActions and Toast saw a swell in their business. This led the firm to the introduction of new services like takeouts, delivery and mobile ordering as it sought ways to keep up with the list of health compliance regulations.
Additionally, the company also introduced a new deal by offering its customers one month credit of software fees, free access to order takeout or buy gift cards.
With all of these strategies in place, it began to accrue more profits towards the end of 2020. This led the tech company to create secondary shares that it was able to put up for sale. The new move allowed previous and current employees of the company to sell as much as 25 percent of their shares, pushing its valuation to around $8 billion.
As of February 2020, Toast was valued at $5 billion. Then, the company sold technology to other restaurants that helped them combine payment gateways with inventory management and multi-location controls especially if the restaurant has more than one branch.
Presently, the company has over 48,000 restaurants on its roster, a massive increase from the 27,000 restaurants it had in 2019. Its annual revenue also rose to $494 million after surging by 118 percent from the previous income. Most of the revenue have been attributed to Toast’s financial technology solutions ie payments the firm had received from its customers for transactions.
Toast also revealed that its customers subscriptions accounted for only 10 percent of its yearly revenue.