Miami — The restaurant business is known for having lots of moving pieces; from customer-centric operations such as food orders and payment processing to backend processes such as payroll and bulk food orders. Traditionally, each piece of the puzzle has required its own solution, which has left a huge opportunity for SaaS products that can provide an all-in one offering.
In the U.S. we saw companies such as Toast solve this problem and make it big when they went public earlier this year and had an initial market cap of more than $37 billion.
In Brazil, we’re seeing a company called Zak follow in Toast’s footsteps. Today, Zak is announcing the close of a $15 million Series A round led by Tiger Global, with participation from Valor Capital, Monashees and Base 10. Tiger Global is also an investor in Toast and had a 12.8% pre-IPO stake in the company, which is why Zak was attracted to the investor, the company said.
Zak, which “helps restaurants manage their own operations,” provides end customers with QR codes, the option to pay at the table or order online - an option that became extremely popular during the pandemic. It also offers a POS system to sell online and offline and payment processing, among other services.
“We’re at the intersection of SaaS and fintech,” said David Grandes, co-founder and co-CEO of Zak.
Recently, the company became a subaquirer, which allows them to process payments on behalf of restaurants. This enabled them to transition from a SaaS only business model into an Embedded Financial Services company, leveraging the best of SaaS retention characteristics with high fintech monetization per customer. They process all payments that happen at the restaurant, both offline and online.
Zak aims to help restaurants to reduce fixed costs. With that in mind, there is no monthly subscription fee, and the company only makes money with each transaction, making it beneficial to them to help restaurant owners grow their businesses.
“We want to empower the restaurants to focus on what they know best, which is to prepare amazing food and delight the customers, and leave the rest to us,” said Andres Andrade, also co-founder and co-CEO of Zak.
“Integrating systems through technology is the future of many industries. In addition to offering a world-class product designed to empower restaurants, Zak has a special team. They have unique insights into the restaurant industry in Brazil and have proven they can deliver innovative solutions to the industry’s main challenges” said John Curtius, Partner at Tiger Global.
Andrade, Grandes and Marina Lima, the three co-founders, previously worked together on another food venture, which is where they gained insights into the restaurant business. “We had to build out a lot of our own technology to operate the business,” said Andrade. And Andrade was actually exposed to the business at a younger age when he worked at a restaurant in the U.S.
Andrade and his co-founders had a kitchen-as-a-service company called Mimic, which helped brands grow by allowing them to out-source production to Mimic’s kitchens. Through this process, they learned that what really lacked in the ecosystem was the innovative all-in-one operations tool that would help run and manage the restaurant business.
Mimic pivoted and re-branded to Zak in 2021, and to date the company has raised about $28 million. It has 170 employees spread throughout Brazil and are present in about 400 restaurants in São Paulo, which gives them a $18.2 million monthly GMV (gross merchandise value).
The company said they’ve processed more than 800,000 orders across all channels.