GrubHub and Seamless face fresh competition.
E-commerce platforms that facilitate online food orders are getting lots of venture capital these days. It’s a simple business model that generates lots of cash because all these firms have to do is take a small cut of each order.
However, the barriers to entry are low and the space is now flooded with new players trying to win the hearts of America’s restauranteurs.
Here are the top companies in the consumer food ordering sector:
GrubHub has been a pioneer in the food ordering space since its founding in 2004. Based in Chicago, the online food ordering company has raised over $84 million thus far from big name investors like Origin Ventures, Leo Capital Holdings, Amicus Capital, DAG Ventures, Benchmark, Lightspeed , Greenspring Associates and Mesirow Financial. With 15,000 restaurant partners in over 400 US cities, the company is angling to go public and would likely become one of food tech’s largest IPOs.
Seamless (formerly SeamlessWeb) is GrubHub’s archrival. The food ordering platform started off focusing on corporate food ordering and has made a recent push into the consumer market. Seamless is differentiated from GrubHub by its focus on urban markets. Seamless was owned by Aramark for a few years but in 2011, it was spun out as an independent entity once it secured $50 million from Spectrum Equity Investors.
ChowNow is an emerging player on the scene and it’s now armed with a fresh round of capital, having recently raised $3 million from VCs like GRP Partners with Daher Capital, Double M Capital, and Velos Partners. ChowNow is betting big on its Facebook Ordering App, which allows customers to order food through a restaurant’s Facebook page.
Campus Special found its niche and it’s a huge one: feeding college students with the late-night munchies. Beyond facilitating coupons and other deals, the firm helps students order from restaurants around their school. With over 300 universities in its network, the Atlanta-based company is growing so quickly it made Inc’s list of the fastest growing companies in America.
Delivery has a network of almost 10,000 restaurants using its e-commerce platform. But the firm wants to own the entire delivery ecosystem and supports shops shipping food, alcohol and groceries.
Munchery is a new service from San Francisco with big ambitions; last November it raised $3.3 million of an ongoing $4 million in Series A funding led by E.Ventures along with Matt Mullenweg, Randi Zuckerberg and El Dorado Ventures’ Tom Peterson. The company allows consumers to order directly from top, local chefs.