Uber has acquired a catering business for $2.3B
What's the story
Uber has announced the acquisition of leading US catering platform ezCater, in a deal worth $2.3 billion. The all-cash transaction marks Uber's latest move to expand its Uber Eats division into new areas of service. Founded in 2007, ezCater has become a go-to marketplace for businesses looking to order large meals.
Business expansion
ezCater's impressive growth and funding history
EzCater has seen massive growth, generating over $2.5 billion in gross bookings in the last year alone.
The company was bootstrapped for seven years before raising its first $4 million round in 2014.
Dara Khosrowshahi, Uber's CEO, sees this acquisition as an opportunity for restaurants to reach new customers and increase their revenue streams through catering services.
Market potential
Uber expands into corporate catering
The acquisition of ezCater gives Uber a strong foothold in the corporate food and catering market.
Instead of individual meals, businesses can use the platform for bulk orders for events or office meetings.
The average order on ezCater is worth over $400, which is much higher than a typical individual order on Uber Eats.
This deal also opens up a new revenue stream based on large food orders paid by companies rather than individuals.
Integration plans
Integrating ezCater with Uber's existing network
Uber plans to integrate ezCater's catering business with its existing restaurant network and corporate customers.
This could allow the company to offer a more comprehensive food-ordering service through its existing business network.
The deal also strengthens Uber's business-focused segment, which serves corporate customers and has seen over 40% growth in gross bookings in Q2.