ChowNow, whose food-ordering platform makes it easier for local restaurants to accept online orders, has raised $21 million in a series C round of funding from private equity firms 3L Capital and Catalyst Investors.
Founded in 2012, California-based ChowNow offers a white label platform that lets independent restaurants set up their own online food ordering systems, whether through their own branded website, mobile app, or social media account. ChowNow also offers its own ordering portals through the web and on mobile phones.
ChowNow’s raise is notable given the current status of the online food ordering industry. The mighty Uber is currently preparing for its long-awaited IPO, and though it is better known for its ride-hailing business, a big chunk of the San Francisco-based company’s business is now focused on food ordering through Uber Eats. Meanwhile, San Francisco-based Postmates — having raised $700 million — is also preparing for its impending IPO. Elsewhere, corporate catering marketplace Ezcater recently raised $150 million at a $1.25 billion valuation.
ChowNow had previously raised around $43 million in outside funding, and this fresh $21 million serves as further evidence that the online food ordering market is hot.
It’s worth noting that ChowNow is a slightly different proposition from other big-brand players in the online food ordering space. Though it can support delivery, food collection is its primary area of focus. In terms of its business model, ChowNow says it doesn’t charge a per-order commission as other companies might, something it decries as a “predatory practice” — instead it charges a monthly fee that starts at $99. Moreover, rather than sucking up all the customer data for itself, it promises that local restaurants retain all their own customer data for marketing and insights.
“Local restaurants are often the heart of neighborhoods, and there should be a way for them to stay competitive and profitable,” said ChowNow cofounder and CEO Chris Webb. “We’re interested in giving these small businesses the tools they need at a fair price so they can focus on doing what they do best.”
ChowNow says it powers the online ordering systems for more than 11,000 restaurants across North America, and it claims that $1 billion worth of revenue is generated through its platform.