Melbourne hospitality tech startup Mr Yum has raised $11 million in funding as it gears up to take its QR code ordering system global.
The post-seed round was led by Bribane venture firm TEN13, and also included AirTree Ventures as a major investor.
It follows a $1.5 million seed funding round closed in May 2019, just six months after the business was founded, and comes off the back of an epic 12 months of growth.
Mr Yum started out as a provider of digital menus for cafes and restaurants, allowing diners to scan a QR code and order meals and drinks from their phones, without having to download an app.
It was a completely dine-in focused product, so when the COVID-19 pandemic hit and hospitality venues went into lockdown, the startup’s revenues fell to zero, co-founder Kim Teo tells SmartCompany.
However, the team built out its pickup and delivery offering within just a few days, setting out to provide an alternative to the likes of UberEats and Deliveroo, which have high commission fees for restaurants.
That development “wasn’t really on the roadmap for another couple of years”, Teo says, but it proved popular.
Teo doesn’t share any specific revenue figures, but she says there were months in 2020 that the business was profitable — something fairly rare for an early-stage, fast-growing startup.
Between December 2019 and December 2020, the dollar value of all transactions going through the app increased 27-fold, she says.
There comes a point in every Aussie startup’s growth story where the founders have to ask themselves whether they only have a product for the local market, or whether they can cross borders. For Teo and the team, it was a no-brainer.
The startup had product-market fit in Australia, and was in the fortunate position of being able to test that some six-to-nine months before other markets started emerging from pandemic-enforced lockdowns.
Mr Yum already has small teams on the ground in the UK and the US, and is picking up customers there too. Just last week, the UK allowed hospitality venues to open to outdoor diners and there are Mr Yum clients among them, says Teo.
In the US, while different states are loosening restrictions at different times, Mr Yum has onboarded customers including a large casino in Las Vegas.
The co-founders wanted to prove they could drop the product into any hospitality business anywhere, and that it would work as smoothly as it does in Australia, Teo explains.
The new funding will also be used to continue pushing product innovation forward, Teo says, as well as bolstering the support model.
“We’re excited to have the funds to run fast at it.”
Australia, let along the US and UK, is not out of the COVID-19 woods yet, however, Teo doesn’t believe Mr Yum is a product solely suited to a pandemic.
The crisis has acted more as a catalyst to tech adoption in the hospitality sector, she says, accelerating a shift that was already underway, but would have taken three to five years without a global pandemic to usher it along.
“We took a bet that it was a catalyst and not a blip,” Teo explains.
Australian venues have now been open for a number of months with fewer restrictions and the founders have seen their customers continuing to use the product.
Hospitality was always a difficult industry to be in, with tight margins and a lot of competition, and so anything that can reduce inefficiency and lead to better customer service is welcome.
If technology can help small business owners make more money, while also keeping customers happy, “there’s no reason to go back”, Teo says.
Comments