EzCater Raises $35 Million To Deliver Food To A Meeting Near You

The market for on-demand food ordering is cutthroat and low margin—at least for consumer startups like DoorDash and Postmates trying to deliver your $25 order of curry and pad thai. But business catering? That may be a different story.

On Wednesday, ezCater announced that it has raised a $35 million Series D round to help grow its online catering marketplace, bringing the Boston-based startup's total funding to $70 million. ICONIQ Capital, the family office and venture firm associated with Silicon Valley billionaires like Mark Zuckerberg, led the funding round with participation from ezCater's existing investor Insight Venture Partners.

In an interview with FORBES, ezCater cofounder and CEO Stefania Mallett said she didn't need the money when they began raising in October, but the cash will go to expanding sales and marketing efforts, as well as beefing up the company's engineering ranks, which she expects to double from 25 to 50 this year. After bootstrapping for its first four years, ezCater began raising money in 2011 and has doubled its headcount in the last 18 months to 175 employees.

"[Our numbers] really look like a hockey stick, but it's actual in our case not a projection," Mallett told FORBES. "We are nationwide and that was a big part of that inflection point. When we got to the point where we could help you anywhere, things really started to take off." She wouldn't disclose specific revenue metrics, but the company says it has been growing at a 2-3x clip for multiple years.

ezCater claims to be the only nationwide two-sided marketplace that matches businesses that need catering with caterers who need business. It boasts nearly 50,000 restaurants, including national chains like Boston Market and Ruby Tuesday. If you're planning a meeting and want to bring in food, ezCater lets you search for restaurants that cater in your area and filter based on factors like cuisine type and price—similar to GrubHub. ezCater then keeps a percentage of each order you make through its platform. It also lets restaurants obtain higher placement in search results if they are willing to share a higher percentage of each order's dollar value.

Mallett says the company is "proudly not profitable" as it pursues growth, but that the fundamentals of the business are stronger than those of consumer startups in the adjacent space who actually pay local employees or contractors to deliver food. GrubHub, originally a pure marketplace business too, has found itself chasing startups like DoorDash, Postmates, and now UberEats into the expensive delivery space.

"I admire and respect those guys," Mallett says of those pursuing a consumer-facing model. "They have to do higher volume. Our orders are 10 times as large so in order to get the same top line they have to deliver 10 times as many."

According to PitchBook, ezCater's previous funding round in late 2015 valued the company at $100 million. Mallett refused to comment on that number, but said the new valuation has jumped "very significantly" with the new Series D. Compare that with DoorDash and Postmates, which last year raised more but at flat or down valuations.