This morning, food delivery company GrubHub announced that it would acquire digital order management platform LevelUp for $390 million cash.
Boston-based LevelUp was started in 2011 and had raised almost $108 million, according to Crunchbase. The company’s platform integrates into restaurants POS systems to facilitate online ordering and payments while offering loyalty discounts to repeat customers. Their software is already in use at 200 fast food and fast casual chains like Sweetgreen, KFC, and Taco Bell.
GrubHub founder and CEO Matt Maloney told TechCrunch that the purchase will allow his company to handle more deliveries and deepen its integration with restaurant partners’ POS systems. By acquiring LevelUp, GrubHub is widening its focus and taking a more holistic tack towards food delivery domination.
This announcement comes a few months after Uber Eats, GrubHub’s biggest U.S. competitor, acquired online ordering platform orderTalk. Both orderTalk and LevelUp integrate with restaurants to facilitate online orders and payments, but LevelUp also brings customer engagement and loyalty perks to the table. And with LevelUp’s long list of restaurant chain partners, including those under the Yum Brands umbrella, this acquisition helps cement GrubHub as the food delivery king — at least for now.
GrubHub has already gobbled up quite a few smaller food delivery businesses — including Seamless in 2013 and Eat24 in October of last year — making it the biggest company in the space (though Uber Eats is growing faster). It makes sense they’d start exploring other strategies, besides pure expansion, to ensure their supremacy.
As Maloney stated in the company’s second quarter earnings report, in which he announced the LevelUp purchase, GrubHub is hoping to become “the most comprehensive solution for restaurants.” With this acquisition, they just got closer to that goal.