Ghent-based Deliverect, which provides an interface between customer-facing delivery services and restaurants, has announced the closure of a $150 million Series D funding round.
The startup, founded in 2018, has seen incredible growth, accelerated by the Covid-19 pandemic, becoming a global operator. The Series D funding brings the total raised by Deliverect to $240 million, leaving the company valued at $1.4 billion.
Led by Coatue Management LLC and Smarten, along with existing investors Newion, OMERS Ventures, DST Global, Redpoint Ventures and Smartfin, Deliverect are using the funding to continue their expansion not just globally but to offer additional services to restaurants, so, with just one click, they can offer a fully digitalised service to customers.
Simplifying orders for restaurants
The cloud service works by integrating various ordering sites for restaurants. With customers able to choose from a plethora of delivery services, restaurant managers must choose between potentially missing customers from some platforms, or having to manage the complexity of multiple order channels.
Deliverect, instead, manages the order flow, taking requests from services like Deliveroo, Uber Eats and Doordash, as well as the restaurants own services, like table ordering apps. Restaurants are left with a single order flow to manage. The software-as-a-service offers a range of price points, making it suitable for small independent operators as well as global brands, and is used by names like KFC, Five Guys and Outback Steakhouse.
The backbone of restaurants
Speaking to TFN, Zhong Xu, Deliverect’s co-founder and CEO, said they are “building the backbone of on-demand foods. We help restaurants to connect to any online platform.”
While delivery services attempt to make it easy for restaurants to take orders, they have no incentive to integrate with competitors. This would mean that a restaurant might find itself juggling multiple iPads, alongside its own internal ordering systems, creating a torrent of demand and no single overview. Each additional service compounds the problem.
The value of the service was proven during the Covid-19 pandemic. With lockdowns forcing restaurants to rely on delivery trade, it was important for restaurants to be on as many platforms as possible. However, this could be problematic, especially at times when the restaurant might be short-handed.
The impact can be seen in Deliverect’s performance. “We are almost at 100 million orders processed in the last three years,” says Zhong, “and, mainly, that’s been in the last twelve months.” The growth has seen them grow to have 300 staff, working from 13 offices covering 14 markets.
Providing more than just the backbone
While orders might be the core product of both restaurants and Deliverect, Zhong plans for the funding to do more than just drive their global expansion.
“We’re launching our app store. Restaurants today are using lots of digital tools,” Zhong explains, “they want to be seen on social channels, work with dining apps, QR codes, ordering apps, and so on.” Deliverect hopes to offer the same simplicity they provide with their integration with delivery services, providing easy ways to onboard additional revenue streams.
“They can go live without worrying about what it means for the operation in the restaurant,” Zhong says. “They don’t need more equipment or training. They click on the app, and it’s all done for them.”
The funding will, however, also help with global expansion. Deliverect is hiring in America and planning a push on Latin American markets as well as opening new offices in Berlin and the Middle East. They are also planning to invest in their customer services, ensuring that restaurants can access round-the-clock support to ensure they succeed.
Helping restaurants survive
Covid-19 hit the hospitality sector hard, with several big names killed by the virus. However, Deliverect is likely to have made a difference to some, offering a solution that helped them keep going.
Before the pandemic restaurants would typically make 20-30% of their revenue from delivery, during lockdowns, it became 100%. And the result has been to permanently change habits. “Pre-pandemic, only 10% of people 55 and older used restaurant delivery,” says Zhong. “Now it’s 40%, everyone has changed their habits, customers are not going back to the old world.”
Along with the need to keep costs low, and difficulties in recruitment, Deliverect was able to help businesses maximise their reach, without increasing their headcount. The result, Zhong believes, has helped businesses. “We serve global chains, small restaurants, and even grocery stores. It’s made a difference for them and helped them survive. It’s a global problem we’re solving.”