Restaurant-Software Provider Toast Prepares for IPO -- Update
February 21 2021 - 4:01PM
Dow Jones News
By Cara Lombardo and Maureen Farrell
Toast Inc. is planning an initial public offering that could
value the restaurant-software provider at around $20 billion,
people familiar with the matter said.
Toast tapped Goldman Sachs Group Inc. and JPMorgan Chase &
Co. to underwrite a possible listing later this year, these people
said. It could also consider other options including a sale or
combination with a blank-check company, some of the people said.
There are no guarantees Toast will ultimately go public or pursue
another of the options.
In going public, Toast, a 10-year-old company whose valuation
has leapt several fold in the past year, would join a red-hot IPO
market fueled lately by the high-profile debuts of companies
including Affirm Holdings Inc. and Bumble Inc. Shares of both are
trading far above their IPO prices, as are those of 2020
predecessors including Airbnb Inc. and DoorDash Inc.
Also powering the record IPO market is a wave of so-called
special-purpose acquisition companies, which go public without a
business and then hunt for one to merge with.
Founded in 2011 by Aman Narang, Jon Grimm and Steve Fredette,
Toast provides payment-processing hardware and cloud-based software
for restaurants. Aside from core point-of-sale offerings, its
products include payroll processing and email marketing, and it
also lends to restaurants through Toast Capital. Competitors
include Square Inc. and PayPal Holdings Inc.
Toast's business initially took an extreme hit from the pandemic
and associated lockdowns. In an April blog post, Toast Chief
Executive Chris Comparato said it planned to reduce staff by
roughly 50%, citing a drop in revenue of more than 80% in March in
most cities. By midyear, however, Toast's business started to
rebound, with new demand for its software as restaurants
transitioned to takeout services and other offerings amid lockdown
restrictions.
The Boston company was valued at around $4.9 billion in a $400
million fundraising round roughly a year ago that included Bessemer
Venture Partners, TPG, Greenoaks Capital and Tiger Global
Management LLC.
The company last week added American Express Co. executive Susan
Chapman-Hughes to its board of directors.
Write to Cara Lombardo at cara.lombardo@wsj.com and Maureen
Farrell at maureen.farrell@wsj.com
(END) Dow Jones Newswires
February 21, 2021 15:46 ET (20:46 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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