$TOST 🍞 Toast IPO S-1 Breakdown


  • As of June 30, 2021, the company reported $494M in ARR indicating a 118% growth Y/Y; it boasts of operations in 48K locations and has a $15B U.S. Serviceable Addressable market.
  • Trailing 12M gross payment volume (GPV) stands at $38B while annual net retention rate is greater than 110%.
  • For the six months ended June 30, 2021 revenue stood at $704M compared to $344M in the year ago period and $823M for year ended Dec.31, 2020.
  • During the six months ended June 30, 2020 and 2021, we incurred net losses of $125M and $$235M respectively while adj. EBITDA stood at $(86) million and $14M respectively.
  • The company believes that it is in the early stages of capturing its market opportunity and locations on the platform represented only ~6% of ~860K restaurant locations in U.S. while ARR as of June 30, 2021 was ~3% of near-term serviceable market opportunity of ~$15B.
  • While technology adoption has increased in restaurants in recent years, it still has one of the lowest levels of digitization across all sectors; U.S. restaurants spent an estimated $25B on tech in 2019 marking it less than 3% of total sales.
  • Spend on technology is expected to increase to $55B by 2024 while Euromonitor projects that, in 2021, 40% of food service revenue in U.S. will be from dine-in, 51% will be from takeout and drive-through, and 9% will be from home delivery.
  • Toast intends to raise capital through an IPO of Class A common stock to be listed on NYSE under the symbol, “TOST”.

Company overview

  • HQ: Boston, Massachusetts, United States
  • Founded Date: Dec 2011
  • Founders: Founders Aman Narang, Jonathan Grimm, Steve Fredette
  • Funding to Date: $858.23M + private transactions
  • Main investors: TPG, TCV, Light Street Capital, Tiger Global, G Squared, BVP, T. Rowe Price, Lead Edge Capital and etc.

Founding Story

Toast Team
Toast Team

When Aman, Steve, and Jon first launched Toast as a consumer payments app for restaurants they quickly found that they were blocked at every turn by tired, dated, legacy point of sale systems and that restaurants of all sizes were in search of a better solution. One that was easy to deploy, could be accessed from anywhere, and intuitive to use.

In July of 2013, they launched Toast Point of Sale. Built on Android and based in the cloud, Toast was quickly embraced by the restaurant community in Boston and grew quickly from there. Through word of mouth, the growth of Tost’s community continued to accelerate. In fact, to this day, 1 out of every 5 new restaurants on Toast comes as a referral from an existing customer.

Today the Company remains passionately focused on serving our community of restaurateurs.

Founding Traction

  • Series B — 2015 at val. $100M, $1.95 pps
  • Series C — 2017 at val. $420M, $6.98 pps
  • Series D — 2018 at val. $1.4B, $17.31 pps
  • Series E — 2019 at val. $2.7B, $27.30 pps
  • Series F — 2020 at val. $4.9B, $45.45 pps

if you are interested in PRE-IPO companies, then I recommend to have a look at a few articles: 1, 2, 3.

How It Works?

Guests. The company is focused on helping customers deliver memorable guest experiences at scale. Guests can place orders easily, safely, and accurately across web, mobile, and in-person channels for dine-in, takeout, or delivery. In addition, the platform empowers restaurants to utilize their guest data to deliver targeted and personalized experiences with loyalty programs and marketing solutions. In June 2021, startup saw an average of over 5.5 million guest orders per day on our platform.

Employees. Toast easy-to-learn and easy-to-use technology improves the experience of up to 500,000 daily active restaurant employees across Toast customers. Employees are core to delivering great hospitality, and it is critical for restaurants to engage and retain employees in an increasingly competitive labor market. So it’s enable new employees to learn quickly through guided workflows, facilitate faster table turns and safer, streamlined operations, and provide greater transparency around, and timely access to, employees’ wages.

The main advantages:

  • Culture of continuous innovation
  • Differentiated go-to-market strategy
  • Unwavering commitment to restaurant success
  • Modern, cloud-based platform approach
  • Unmatched data-driven insights
  • Powerful partner ecosystem

The market opportunity

The approximately 860,000 restaurant locations in the United States are highly diverse, in everything from location to type of cuisine and format to number of employees and amount of revenue. Regardless of these differences, operating a restaurant is challenging and complex. In general, restaurants operate with low margins, high employee turnover, highly perishable products, and complex regulations. At the same time, the restaurant industry, like many other sectors, is undergoing foundational changes driven by changing guest preferences and the imperative to utilize technology and data to innovate. What was once primarily an on-site experience with antiquated solutions such as pen and paper is now becoming an omnichannel experience that employs technology to enable dining in a restaurant, picking up curbside, or ordering delivery. Restaurants in the United States spent an estimated $25 billion on technology in 2019, which was less than 3% of their total sales.

The Growth Strategy

  • Fuel efficient location growth with both new and existing customers. Toast intend to invest in the field-based go-to-market engine, customer success through a combination of tailored onboarding services, customer support, and intuitive product design, as well as research and development of new products to continue to meet the industry’s evolving needs and grow location footprint.
  • Increase adoption of full suite of products. Toast plan to continue to sell additional products to existing customers through a combination of sales and marketing efforts and product-led growth.
  • Invest in and expand the platform. Toast intend to continue to invest in research and development to expand the functionality of the current platform and to broaden the subscription services and financial technology solutions they offer.
  • Further develop of partner ecosystem
  • Selectively pursue inorganic growth
  • Expand internationally

Financial Data

Toast grow customer base through a diverse array of marketing and sales channels. As of June 30, 2021, approximately two-thirds of new locations added to the Toast platform in the last twelve months came inbound across our organic, paid, field, and referral channels. The sales team integrates deeply into the local restaurant community, enabling the company to spend significant time with customers and prospects and helping to Toast retain existing customers and onboard new customers. While Toast have meaningfully grown the size of the sales team over time, they have also continued to increase its efficiency.

The following table reflects the reconciliation of net loss to Adjusted EBITDA for each of the periods presented:

Results of Operations

  • Total revenue increased 24% to $823.1 million for 2020, as compared to $665.0 million for 2019.
  • Revenue from subscription services increased 62% to $101.4 million for 2020, as compared to $62.4 million for 2019. The increase was attributable to growth in restaurant locations on the Toast platform and the continued upsell of products to existing customers, partially offset by COVID-related SaaS credits and refunded fees.
  • Revenue from financial technology solutions increased 21% to $644.4 million for 2020, as compared to $531.8 million for 2019. The increase was generally reflective of our 17% increase in GPV for the same period, with slightly faster growth in revenue due to a greater mix of card-not-present transactions as restaurants shifted their business to adapt to the COVID-19 pandemic.


Toast’s mission is to empower the restaurant community to delight their guests, do what they love, and thrive.

Lead Toasters

Chris Comparato is Chief Executive Officer and a Director of Toast. He has an extensive background in leading high growth SaaS, software, and consulting companies with a focus on customer success and building strong teams. Prior to Toast, he led all customer success functions at Acquia (named Inc. 500 #1 fastest growing company) and Endeca (acquired by Oracle in 2011). He previously held roles at consulting firms Keane and Cambridge Technology Partners, where his track record of delivering innovative business technology to diverse industries started. He holds a BS in Mechanical Engineering from Union College.

Steve Fredette (President, Co-Founder and Director)

Steve Fredette is President, co-founder and a Director of Toast, where he leads product and innovation initiatives. Prior to Toast, he worked on mobile app development before the iPhone came out, creating the first Flickr and Shoebuy.com apps. At Endeca, now Oracle, he co-founded their mobile commerce business, building the product team and driving sales, marketing, and services to over $10 million in revenue in two years. He also ran the Special Operations team at Endeca, creating new prototypes for various customer and business needs, including Endeca’s business intelligence platform. Steve holds a BS degree from MIT.

Aman Narang (Co-President, Co-Founder, COO and Director)

Aman Narang is President, co-founder, Chief Operating Officer, and a Director of Toast. Prior to Toast, he worked on innovation initiatives at Endeca, now Oracle. Aman spearheaded the development of Endeca’s business intelligence platform as well as their mobile commerce platform, each of which became major business units. He holds BS and MS degrees in Computer Science from MIT and currently leads innovation and business development initiatives at Toast.

Jonathan Grimm ( CTO & Co-Founder)

Jonathan Grimm is CTO and co-founder of Toast. Prior to Toast, he held solution engineering and application development leadership roles at Endeca/Oracle, interacting with customers on a day-to-day basis and developing new frameworks for the development team. He now spearheads Toast’s software and technology efforts, focusing on scalable infrastructure and technology architecture. With a passion for startups, he leads initiatives to grow the business from a technology perspective. Jon holds a BS in Computer Science from MIT.

IPO Details

  • No existing shareholders have indicated an interest to purchase shares at the IPO price.
  • Listed bookrunners of the IPO are Goldman Sachs & Co. LLC, Needham & Company, Canaccord Genuity, KeyBanc Capital Markets, William Blair, Piper Sandler and R. Seelaus & Co., LLC.

— — — — — —

About the Author

Previously: Twilio, Xiaomi, iQiyi, PinDuoDuo, Tilray, Livongo, Agora, Bandwidth, Hims, Coursera.

Currently: Robinhood, Enflame, Grab, Intercom, Toss, Oatly, Epic Games, Chime, and other

Contact — here, If you are a startup building in this space — email or DM me to be included on this article.

The content was collected from various open sources, approved by companies, and does not provide any one-stop recommendation for the purchase of shares. All data was used for only informational purposes and does not contain insider information that may be malicious or refuted by the company and SEC.

This communication does not represent an offer or solicitation to buy or sell securities. Such an offer must be made via definitive legal documentation by the buyer or seller of securities, please check the SEC rules before buying shares from any stock-suppliers.

Serial entrepreneur, accredited investor, and hedge fund manager.