Sydney-based wholesale hospitality marketplace FoodByUs has today closed a $12 million Series B funding round led by global venture capital firm Base Capital, with funds going towards the further scaling of its platform that is revolutionising procurement processes for venues nationwide.
FoodByUs - a platform founded in 2016 that connects restaurants, cafes and caterers with wholesale food and alcohol suppliers, saving them millions of hours of ordering time - says the Series B follows an ‘exceptional’ period of growth over the past 12 months, including record month-on-month revenue and a 200 per cent increase in suppliers on the site.
The news comes more than a year after FoodByUs closed a $10 million Series A funding round in November 2021 for founders Tim Chandler, ex-Menulog boss Gary Munitz and Ben Lipschitz - the latter whom was a finalist in the 2022 Australian Young Entrepreneur Awards and the winner of the 2022 Sydney Young Entrepreneur Award in the Hospitality & Tourism category.
The company says the latest funding round will support the platform’s expansion, alongside facilitating in-house improvements to ‘critical’ sales, rostering, accounting and reservations software.
In addition, the FoodByUs platform acts as a one-stop-shop marketplace with procurement features enabling operators to run their entire back-of-house operations in one place.
This includes allowing venues to search and compare prices on hundreds of thousands of products, giving them access to purchasing power normally reserved for much larger businesses.
“FoodByUs was built on the premise of improving the often overlooked ‘back of house’ function within hospitality venues,” co-founder and CEO Ben Lipschitz said.
“Procurement time and costs are one third of a venue’s expenses yet are often where the profit is made (or lost). In the past few years alone we have helped independent restaurants and cafes save close to $16 million in costs and 2,643,750 hours in time ordering.”
The co-founder now believes the company has proved its value to SME customers, meaning FoodByUs is moving into its next growth phase.
“Launching a wholesale food marketplace was a novel idea and it took some time to prove value for both sides - which we’ve now done beyond a doubt,” Lipschitz said.
“We’re now in a high growth phase and are completely focused on building an incredibly high quality software product, without which independent venues simply could not operate.
“We’re already the leading solution in our market, this round will help cement FoodByUs as the dominant hospitality procurement tech in Australia.”
In addition to contribution from Series B leader Base Capital, a South African investment firm that supported the startup’s Series A in 2021, backers of the latest tranche include F J Labs, Trawalla Group, and Macquarie Capital which has invested in the business since its inception.
“The leadership team at FoodByUs is exceptional and a leading factor in what drew us to the business,” Base Capital founder and partner Paul Rutherford said.
“We were also drawn to the combination of operating software with an open marketplace delivering an innovative approach to how restaurants and food suppliers manage their businesses.
“Supporting this is a very strong growth trajectory along with excellent engagement and retention of customers.”
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