By RTN Staff - 12.7.2022
Restaurant technology solution provider MarginEdge has raised $45 million in a Series C funding round, only a few months after closing a Series B round. The latest round was led by Ten Coves Capital, with participation from Fiserv, Derive Ventures, and previous investors. This brings the Virginia-based company’s total funding to over $70 million. MarginEdge reportedly plans to use the new funding to further scale the team and expand the functionality of core product offerings.
MarginEdge closed an oversubscribed $18 million Series B investment in September. Schooner Capital led the round with follow-on investments from all major and strategic investors to-date, including Osage Venture Partners, Gordon Food Service’s innovation arm Relish Works and Nigel Morris. The company secured a Series A funding round of $5 million in October 2019, as reported here, then an A2 in 2020.
The MarginEdge platform offers invoice processing, inventory management, recipe analysis, budgeting, performance tracking, and supplier bill payment capabilities. It aims to simplify the complex business of running a restaurant by providing real-time data and insights to enable better business decisions, drive cost efficiencies, and save time for operators.
The company’s stated mission is to “create a world where restaurant operators can focus on the business they love. By using best-in-class technology to eliminate unproductive paperwork and streamline the flow of operational data, MarginEdge is reimagining the back office and freeing restaurants to spend more time on their culinary offerings and guest experiences.” In a nutshell, the company offers solutions designed to automate tedious processes, connect systems and streamlines key activities, like inventory, cost-tracking, ordering and recipes.
MarginEdge was founded in 2015 by restaurant veterans and entrepreneurs Bo Davis, Roy Phillips and Brian Mills. Phillips previously served an executive at Bloomin Brands while Davis previously launched a chain of conveyor belt-driven sushi restaurants called Wasabi. The company serves a diverse group of restaurant operators, from single units and small chains to large franchise and hospitality groups. Today the company reportedly services over 4,000 restaurants in all 50 states and Canada, and processes over $3 billion in annual invoices.
The company’s stated mission is to “create a world where restaurant operators can focus on the business they love. By using best-in-class technology to eliminate unproductive paperwork and streamline the flow of operational data, MarginEdge is reimagining the back office and freeing restaurants to spend more time on their culinary offerings and guest experiences.” In a nutshell, the company offers solutions designed to automate tedious processes, connect systems and streamlines key activities, like inventory, cost-tracking, ordering and recipes.
“There’s several factors that investors look at that are very important, and one is the size of the market, meaning the number of restaurants MarginEdge can potentially work for,” explained Bo Davis, CEO and Co-Founder of MarginEdge, in a Spotlight Interview with Restaurant Technology News. “Another is the speed at which restaurants are adopting MarginEdge, which is a very exciting metric for us. During the funding round we were growing at 100% year on year and we still are now. Other than these two, they also look at the stickiness of clients (meaning our retention rate of clients), which is extremely high. It gives investors a lot of confidence that there’s value being built in the business when clients are staying.,” . “In the current environment, and with everything the restaurant community has had to navigate these last few years, this mission has never been more important.”
The funding round represents excitement around MarginEdge’s growing embedded payments and financial service offerings. MarginEdge has been integrated with over 50 POS and accounting platforms, and in 2022 alone entered into collaborations with Intuit, Gordon Food Service, 7shifts, and SpotOn. The SpotOn integration aims to equip users with tools to manage daily controllable P&Ls and sales data, seamless accounting integration with the automatic flow of data from invoices, credits, and payments, and robust performance reporting including theoretical food usage and menu analysis to help identify profit leaks and rising food costs.
The company has been recognized as one of America’s Fastest Growing Companies on the 2022 Inc. 5000 Annual List, and is also a “Best Place to Work” according to the Washington Post and Washington Business Journal.
Clearly, the deep experience in the restaurant industry that MarginEdge’s founders brought to the table has paid off in spades. “Between us, we’ve opened and operated about 40 restaurants,” Davis. “In doing so we learned and understood very deeply what the difficulties are in the back office, the kitchens, and for the accounting teams. MarginEdge was built from the ground up to really solve those needs.”
