This edition of MRM’s News Bites features DoorDash and Square, Cheesecake Factory, delivery.com, California Pizza Kitchen, White Castle and Uber Eats, Wayback Burgers and PourMyBeer and Micro Matic.
DoorDash to Acquire Caviar
DoorDash entered into a definitive agreement with Square (NYSE: SQ) to acquire Caviar for $410 million in cash and DoorDash preferred stock.
Company officials said the acquisition creates a highly differentiated company with a unique brand and wide-ranging selection. It also underscores both DoorDash and Caviar’s strategic commitment to merchant selection. The addition of Caviar’s premium restaurants, with whom DoorDash will work closely to drive their growth, will enable the combined organization to cater to every food preference and occasion. Caviar’s complementary geographic footprint provides DoorDash with a significant number of new and unique customers, who will benefit from an even broader set of merchants.
The transaction continues to build on the partnership between DoorDash and Square. DoorDash is currently integrated with Square for Restaurants point of sale, which streamlines the acceptance of online and in-person orders for merchants, and in the second quarter Cash Boost partnered with DoorDash to provide instant rewards when customers use their Cash Card at DoorDash.
Tony Xu, CEO of DoorDash, said: “Today’s announcement is another important step forward on our mission to empower local economies. We have long-admired Caviar, which has a coveted brand, an exceptional portfolio of premium restaurants and leading technology. The acquisition further enhances the breadth of our merchant selection, enabling us to offer customers even more choice when they order through DoorDash. We look forward to welcoming the Caviar team to DoorDash and expanding our partnership with Square in the future.”
Gokul Rajaram, Caviar Lead, said: “Caviar has built a trusted brand with customers and many of the best restaurants. DoorDash has national scale, complementary restaurant selection, a tremendous logistics platform, and a team that shares our passion and commitment to better serve restaurants, couriers, and customers. I’m incredibly excited to be joining, with the rest of the Caviar team, to help build the future of local commerce.”
Jack Dorsey, CEO of Square, said: “We are increasing our focus on and investment in our two large, growing ecosystems—one for businesses and one for individuals. This transaction furthers that effort, and we believe partnering with DoorDash provides valuable and strategic opportunities for Square.”
The transaction is subject to certain closing conditions, including regulatory approvals, and is expected to close in 2019.
Cheesecake Goes for Experiential
The Cheesecake Factory Incorporated entered into definitive agreements to acquire Fox Restaurant Concepts and the remaining interest in North Italia, reinforcing its leadership position in experiential dining.
““Since making our initial minority investments in North Italia and Flower Child in 2016, we have not only helped fuel the growth of both brands, but also developed a deep relationship with Sam Fox at Fox Restaurant Concepts,” said David Overton, Chairman and Chief Executive Officer of The Cheesecake Factory Incorporated. “We realized the true potential of this relationship as we worked through the integration process for our planned acquisition of North Italia. It became evident that the combination of two of the most experiential and entrepreneurial restaurant companies could drive greater value as one organization.”
Overton continued, “In turn, we have decided to bring together North Italia and Fox Restaurant Concepts, including Flower Child, with The Cheesecake Factory to reinforce our leadership position in experiential dining. With the power of The Cheesecake Factory brand, infrastructure and growth potential, complemented by an additional growth vehicle in the North Italia concept and an incubation engine to develop concepts of the future, we believe we will be even better positioned to provide our guests with exceptional dining experiences, offer growth opportunities for our respective teams and maximize long-term value for our shareholders. We look forward to continuing to work with Sam to expand the businesses.”
Sam Fox, Founder and Chief Executive Officer of Fox Restaurant Concepts, said, “This partnership will be the first of its kind for the restaurant industry. David Overton and I quickly realized the magic occurring between our organizations while we worked through North Italia’s integration. With our aligned cultures and philosophies, The Cheesecake Factory is the right partner to embrace our creative spirit, enabling us to innovate concepts, while providing the infrastructure and capital to scale.”
The transactions will be completed for $308 million in cash at closing. An additional $45 million will be due ratably over the next four years. The Company previously invested $88 million in the North Italia and Flower Child concepts over the last three years in anticipation of their purchase. The cash due at closing will be funded by drawing on the Company’s upsized revolving credit facility and cash on hand. The FRC transaction also includes an earn-out provision based on the financial performance of the FRC brands outside of North Italia and Flower Child. The Cheesecake Factory Incorporated’s Board of Directors has unanimously approved the transactions, which are expected to close around the end of the third quarter of fiscal 2019, subject to the expiration of the applicable Hart-Scott-Rodino Act waiting period and other customary closing conditions.
Following the completion of the transactions, North Italia’s operations will be located at The Cheesecake Factory Incorporated’s corporate headquarters in Calabasas Hills, California to help scale the concept nationally. Since the initial investment in 2016, the Company has been working closely with North Italia’s operations and leadership team to construct a comprehensive integration plan. In turn, the Company anticipates a smooth integration process. FRC will operate as a wholly-owned subsidiary, and continue to be led by Sam Fox, Founder and Chief Executive Officer of FRC, from FRC’s headquarters in Phoenix.
delivery.com Acquires Mr. Delivery
delivery.com acquired Mr. Delivery, an online ordering and food delivery service headquartered in Austin, Texas. With the acquisition, delivery.com now connects more than two and a half million customers and corporate clients with 15,000 restaurants, liquor stores, dry cleaners and other local businesses in more than 1,800 cities.
Company officials said the acquisition of Mr. Delivery marks the beginning of rapid expansion efforts and initially includes food delivery operations across 160 cities, with additional companies to be onboarded in coming months. delivery.com plans to bring its full set of services to Mr. Delivery markets, including group ordering and other corporate features, as well as expanded offerings beyond food delivery. For the first time, delivery.com will also offer last-mile capabilities for delivery orders, support it plans to make more widely available to merchants. Mr. Delivery will take on the delivery.com brand and technology effective immediately.
“Independent delivery service operators, many without access to venture capital, have built consequential businesses that have become part of the fabric of their local economies, and for that they should be commended. We look forward to working with them—not around them—to accelerate growth," said Jed Kleckner, CEO of delivery.com. "delivery.com has always focused on making the best local restaurants and stores available for delivery and pickup to patrons in the neighborhood, and Mr. Delivery shares our vision of empowering communities and businesses. Our complementary business models and missions make this acquisition a natural and timely fit given our broader expansion strategy this year.”
“We’re thrilled to join forces with delivery.comand provide our market operators, consumers, restaurant owners, and drivers with access to delivery.com’s proven technology platform that delivers an excellent ordering experience across web and mobile apps,” said Laurence Levine, CEO of Mr. Delivery.
CPK Take and Bake
California Pizza Kitchen (CPK) introduces CPK Take and Bake Pizzas for takeout and delivery nationwide. CPK Take and Bake Pizzas ensure restaurant-quality, California-style pizza at home with the convenience of baking on your schedule, guaranteeing an oven-fresh pizza experience every time.
“We’ve cracked the code on the very best takeout and delivery pizza experience, bar none,” said Jim Hyatt, CEO and President of CPK. “We believe every pizza is best enjoyed fresh and hot from the oven, which is why our iconic yellow hearth pizza ovens are the heartbeat of our kitchens. For our guests who prefer to enjoy CPK at home, whether grabbing takeout after work or ordering delivery for pizza night with family and friends, we’ve created CPK Take and Bake Pizzas to ensure you enjoy our creative, California-style pizzas just as fresh, hot and delicious as you would at our table.”
Available in each of CPK’s 20 pizza varieties, Take and Bake Pizzas can be prepared on original hand-tossed dough or CPK’s veggie-based Cauliflower Crust that’s made with gluten-free ingredients. CPK’s Gluten Intolerance Group-certified gluten-free pizzas are also available Take and Bake-style.
“California-style pizza celebrates creative flavors and high-quality, fresh ingredients, using pizza crust as the canvas,” said Brian Sullivan, Executive Chef and SVP of Culinary Innovation at CPK. “We were inspired to create Take and Bake Pizzas to give our takeout and delivery guests the same restaurant-quality experience at home as they’d have in our restaurants. That means bringing our premium ingredients like hand-torn rustic pepperoni, Nueske’s applewood-smoked bacon, fresh sliced avocado, smoked Gouda, garlic scampi shrimp, flavorful sauces and a variety of fresh produce from our kitchen to yours, to elevate the home pizza experience and make meal time easy and delicious.”
White Castle Teams with Uber Eats
White Castle inked a new partnership with Uber Eats, offering online ordering and delivery to Cravers near more than 330 White Castle locations. Cravers can now order any of White Castle’s coveted menu items, such as The Original Slider®, the plant-powered Impossible Slider, or even a Crave Case for those with the boldest of appetites, through the Uber Eats app. Beginning July 30, White Castle will be giving away up to 1 million Original Sliders, in quantities of 10 per customer. Craving customers should act now, as the free “slider-tunity” will end once 1 million sliders have been given away, or on August 31, 2019.
“At White Castle, we’re always working to improve the access and ease of enjoying our iconic sliders for our loyal customers across Craver nation,” said Lisa Ingram, CEO at White Castle. “In 2004, we learned of a daring and arduous trip that two fans took to fulfill their Cravings. Today, we’re happy to partner with Uber Eats to take our delivery capabilities to an entirely new level and make sure we’re meeting customer needs where and when they arise.”
Wayback Gives Back
Wayback Burgers is celebrating a successful first year of their partnership with Boys & Girls Clubs of America. Through a series of programs, events and promotions, Wayback Burgers was able to raise $151,160.78 in one year. As a result of these efforts, Wayback Burgers has been nominated for the Franchising Gives Back Award from the International Franchise Association(IFA).
The partnership was initially launched in July 2018 and has benefited the national Boys & Girls Clubs of America organization as well as local chapters throughout the U.S. Wayback Burgers and their franchisees have pledged to make an annual donation of up to $150,000 with a minimum of $100,000 for two years from the launch date. Boys & Girls Clubs of America is dedicated to helping young people reach their full potential as productive, caring and responsible citizens.
Fundraising efforts have included an ongoing program through which a portion of every burger and sandwich sold at Wayback Burgers restaurants nationwide is donated to Boys & Girls Clubs of America. Through this initiative alone, Wayback has been able to raise over $118,000.
Most recently, Wayback Burgers hosted a national Milkshake Naming Contest. As part of this exciting contest, members of Boys & Girls Clubs across the country submitted unique milkshake recipes and corresponding names. Wayback Burgers narrowed down the recipes to the top three ideas and then let Wayback Burgers’ fans vote for their favorite flavor. The winner was the Caramel Cinnamon Toast Crunch Milkshake, which will be available as a limited-time offer starting August 1.
“We are thrilled by the success of our first year of partnership with Boys & Girls Clubs of America,” says John Eucalitto, CEO of Wayback Burgers. “This organization is truly incredible. They work hard every day to help children in need in communities across the country. We are excited to build on this momentum as we move into year two of the partnership.”
Million Dollar Self-Pour Giveaway Winner
In the spirit of National Beer Day, on April 7, PourMyBeer and Micro Matic launched a Million Dollar Self-Pour Giveaway. After nearly 500 essays received for this contest since it was announced, they found the winner.
If you’re not familiar with self-pour technology, over 500 self-serve taprooms have opened in the United States since 2013. Gone are the days where you need to wait for bartenders or waitresses to get your drinks. You are able to sample and pour from 20 to 100 different taps at these self-pour taprooms using an RFID wristband or card. After registering the card or wristband and connecting that to an open tab, customers have access to the tap wall which dispenses beers, wines, cocktails, coffee, kombucha or anything else in a keg. When a customer is ready to pour, they select a glass, place the PourMyBeer card into the RFID card reader and simply pull the tap handle to start pouring. Drinks are charged by the ounce vs. by a full drink, allowing customers to sample and enjoy many different types of beverages and pay for what they pour. Sampling and enjoying a variety of drinks has never been easier.
Since the customers are charged by the ounce, bars and restaurants no longer lose money on waste, theft or freebies. These improvements through service drive operational costs down by 30-40% and increase sales by 30 percent, leaving more margin for the owners and a consistently better experience for the guests.
PourMyBeer, and Micro Matic, teamed up to reward one small business owner with the equipment and technology to run a million-dollar self-pour taproom, i.e. generating an estimated $1 million or more in annual sales.
All participants had to fill in a series of questions about their future plans and level of seriousness about the self-pour concept. The most important part in the decision-making process was an essay explaining why the entrant should be chosen as the winner. With close to 500 entries, the decision was not easy but the PourMyBeer and Micro Matic teams saw the huge potential down in New Orleans where Andrea Kutcher and her partner Jordan Barkoff, top photo, both huge craft beer enthusiasts, applied with their dream to bring the PourMyBeer self-serve system to their town.
In January of this year, Andrea and Jordan were in North Carolina looking for a craft beer bar to visit while they were traveling. They ended up going to a self-pour taproom where they experienced it for the first time. After sampling about 10 different beers by the ounce, they knew two things. One, they LOVE LOVE LOVE self pour taprooms and two, they needed to bring this to New Orleans. They told a bunch of friends about their intention to open one up and one of their friends shared our contest with them. They culminated their best 200 words for why they deserved to be chosen as the “Million Dollar Self Pour” winners and we agreed. With the help of PourMyBeer and Micro Matic, this project can take flight. Kutcher said: “We are both passionate about beer and feel this is the next step for beer lovers in New Orleans. We're looking forward to our partnership with PourMyBeer and we are beyond excited for this amazing opportunity to realize our dream!”
Andrea and Jordan have been together for four years and beer has always been their passion. They even met each other at an IPA day event in New Orleans. With a background in marketing, Andrea has worked with companies like NOLA Brewing Co., Avenue Pub – top craft beer bar in Louisiana – New Orleans Tourism and more. For two years, she served as CMOO for NOLA Distilling leading all startup efforts. Jordan cut his teeth working for wineries in Napa Valley and New Zealand before switching to the brewing. He has worked at NOLA Brewing Co. for six years, the last two-plus as VP of Operations overseeing the day to day operations of the facility.
When they learned the news about winning, they celebrated by opening a bottle of Crooked Stave Silly Cybies. Kutcher said: “We've toyed around with the idea of opening a brewery or a brewpub for a few years but felt like the market has gotten a little saturated in our hometown of New Orleans. Last year, we went to our first self-serve taphouse in North Carolina and thought 'This should exist in New Orleans' – ever since, we've shifted our plan from brewery to a self-pour taproom.”
Josh Goodman, the CEO of PourMyBeer, added, “Choosing the best candidate wasn’t easy. There were so many great essays from the people that applied, but our team unanimously agreed on one winner. As a company, it’s great to be able to give someone the opportunity with our technology to execute. It never gets old for us to see the first time or repeat entrepreneurs go out and crush it with our self-pour technology.”