Touchbistro recently closed a $150M round of mixed equity and structured debt, intended to carry the company to an eventual IPO. Touchbistro has been preparing itself to become a publicly listed entity.
We caught up with Samir Zabaneh, Touchbistro’s CEO, to talk through his company’s recent transaction.
What are you doing with the funds?
Samir:
Generally, the new funds will be used to accelerate our growth, continue to upgrade the technology stack and introduce new products, as well as complete select strategic acquisitions.
Please provide color on the technology stack.
We’re significantly upgrading our technology stack to better serve the multi-location and mid market customers, and to better enable ease of integration with our current and new partners. The new stack will provide a modern cloud native application instead of being on-premises, which will speed our products and features development and deployment, and provide flexibility to our customers.
Touchbistro was working on some pretty advanced marketing features last we spoke. What changes now that you’ve raised this money?
Samir:
We launched a CRM and are actively working to enhance our guest engagement capabilities. We see this as a large opportunity to demonstrate differentiation and provide more value to our customers. It’s no secret that restaurants are worried about the economy, and profitably generating incremental transactions will become more important for our operators – and operators generally.
Our comments: Shopify and Lightspeed have launched an in-POS digital ad builder, so it’s not unreasonable to expect Touchbistro to offer something similar.
Toast is working hard to convince investors that they’re not out of TAM and can move upmarket. How are you seeing things play out?
Samir:
It’s no secret that larger independent merchants have been our core customer base. Recently, however, we’ve seen larger groups seek modern POS solutions. Touchbistro is now getting into larger, multi-location units, and we’ve even built a direct mid-market sales team to go after these opportunities.
We recently began to expand our outbound channel, including teams specifically focused on the major and secondary US and Canadian markets. We’re seeing accelerating adoption into larger accounts that need more support throughout the buying process.
We define mid-market as greater than $3M in revenues, whether it’s a single location or multi-location. In fact, the feature enhancements we’ve been working on are alluring to these customers. For example, we’ve developed remote menu management, multi-location reporting, expanded account permissioning, and more to successfully support bigger groups.
Our comments: larger merchants are finally getting tired of dealing with legacy POS companies like NCR. In the early years they were sold false promises by the legacy incumbents – e.g. “Oh sure, we are going to cloud and will have parity in no time”, and then IT thought they could bandaid their way through the pandemic. It turned out that it’s borderline impossible to get by in today’s digitally connected economy with a turd of a POS.
Touchbistro has always been an agreeable POS company, actively supporting third party partnerships and doing right by the customer. Maybe this just comes with being Canadian.
Either way, it’s good to have another strong competitor keeping Toast honest.
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