The company will offer existing customers US$5,000 to US$250,000 for a fixed fee, and use transaction data to adjust payback schedules and amounts. WebBank, a U.S. chartered bank, will issue the loans. (The Logic)
Talking point: The POS market for independent restaurants and small chains is large and crowded, but fragmented. As startups bid to replace existing cash registers with software subscriptions, they’re expanding their offerings to include management functions like scheduling and inventory, and launching add-ons that bring in transaction-based revenue. Involving WebBank means Toast gets data and a cut of profits without loaning out any of the US$250 million it raised in March. The move opens another front of competition between Toast and Toronto-based TouchBistro, which raised $158 million in September to build more restaurant-management tools. TouchBistro’s investors include RBC, BMO, Barclays and JPMorgan Chase; CEO Alex Barrotti told The Logic that its financial partners offer loans directly to TouchBistro customers. “Unlike Toast, TouchBistro has adopted a strategy of partnering with, rather than competing with, key banks around the globe,” he said.