By Nicole Norfleet Star Tribune (Minneapolis)
WWR Article Summary (tl;dr) "Bite Squad" is a Minneapolis based online platform that connects thousands of restaurants across the country with people who want food delivered.
Star Tribune (Minneapolis)
Bite Squad, the Minneapolis-based food delivery company with a national reach, has been gobbled up by Waitr Holdings Inc. in a $321.3 million deal.
The deal marks one of the largest financial exit events for a Minnesota tech startup in recent years, though Bite Squad will continue as a stand-alone business and brand for the foreseeable future and its team of more than 100 Twin Cities employees will remain intact, a Bite Squad spokeswoman confirmed.
Waitr, based in Lake Charles, La., has a similar online platform for restaurant ordering and food delivery as Bite Squad, but it primarily serves cities in Louisiana, Texas, Georgia, Alabama and Mississippi.
The acquisition, announced Wednesday, significantly expands Waitr's footprint across the United States to more than 500 cities and 22 states.
"We have followed Bite Squad's growth and success for many years and believe their mission, business model and growth profile share many similarities to Waitr," Chris Meaux, chief executive of Waitr, said in a statement.
The deal comes just a month after Texas businessman Tilman Fertitta, owner of the Houston Rockets, bought Waitr through a special purpose acquisition company that raised $250 million when it went public in 2016. That company, called Landcadia Holdings Inc., renamed itself Waitr Holdings Inc. after it spent $308 million on Waitr.
Fertitta also owns Golden Nugget Inc., a casino firm, and Landry's Inc., a chain of steakhouses.
Meaux said company executives believe the food-delivery industry is still young. "A small fraction of the U.S. restaurant industry's sales are from off-premise online transactions and this is evolving rapidly," he said. "This acquisition will help us drive additional growth."
The deal for Bite Squad consists of $202.1 million cash and 10.6 million shares of Waitr stock. Shares in Waitr were up 2 percent in afternoon trading on the Nasdaq Stock Market.
Founded in 2012, Bite Squad today partners with more than 11,000 restaurants across over 300 cities for food delivery.
"We are thrilled to join forces with the Waitr team," Kian Salehi, chief executive of Bite Squad, said in a statement. "I believe Chris and his team share our vision for providing hungry diners with a convenient and fast way to enjoy great food from the best local restaurants and chains."
Bite Squad in the past two years acquired 40 smaller food-delivery firms in cities across the nation. The company was bootstrapped by founders Salehi and Arash Allaei. They raised about $5 million in a Series A investment from Brightstone Venture Capital of Minneapolis in late 2015.
Bite Squad's third-quarter revenue nearly doubled from a year ago, the companies said in the acquisition announcement, though a specific figure wasn't disclosed.