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Exclusive: Restaurant delivery software startup Loop raises $6M

Mar 12, 2024
Illustration of a food delivery bag, with a dollar stapled to it instead of a receipt.

Illustration: Brendan Lynch/Axios

Loop, a startup helping to make third-party delivery more profitable for restaurants, raised $6 million in seed funding, the company tells Axios exclusively.

Why it matters: Third-party delivery continues to increase its share of restaurant revenue, but fees and commissions can account for 15% to 30% of sales.

  • Restaurants also have to deal with chargebacks and order inaccuracies, which affect 3-4% of all sales from third-party marketplaces.

The big picture: "Restaurants are in a place where they have to look at this revenue stream sustainably and profitably, and they can't do a patchwork of solutions," Loop founder and CEO Anand Tumuluru says.

  • But restaurant POS systems and ERP systems don't account for the costs and complexity of third-party delivery services.

How it works: Loop's platform provides tools for restaurants to manage financial reconciliation and bookkeeping across multiple third-party delivery services.

  • It tracks chargebacks and order inaccuracies while helping restaurant brands keep their stores up on those services on different delivery marketplaces.
  • Loop also provides an issue discovery module store managers can use to pinpoint poor performance or quality control problems.
  • The company charges a monthly SaaS fee to customers based on their third-party order volume.

Loop primarily serves large fast-casual chains that must manage deliveries across multiple locations and platforms.

  • The company has already signed up restaurant brands like Dave's Hot Chicken, Freddy's Frozen Custards, Mo'Bettahs and Mooyah as customers.
  • And it has reconciled more than $100 million of restaurant transactions to date.
  • The financing was led by Base10 Partners, with participation from Afore Capital.

What's next: The company sees an opportunity to broaden the scope of its platform over time.

  • "Our goal is to eventually become the reconciliation tool for [restaurant] inventory as well... and basically use that as a wedge to go deeper into the restaurant back office," Tumuluru says.
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