Foodbomb, a six-year-old wholesale food marketplace, has been acquired by hospitality ordering platform Ordermentum for an undisclosed sum.
Founded in 2017 by Paul Tory and Josh Goulburn, Foodbomb raised $4.5 million in a Series A two years ago. Its backers include EVP, Athletic Ventures, Aura Ventures, Tony Gandel’s family investment vehicle, Tahmedia, and Platform Advisory Partners.
EVP partner Justin Lipman said the M&A deal will see his VC firm take a stake in Ordermentum, which also raised $16 million as part of the acquisition, which gives the combined business a $100 million valuation.
The VC already had an inkling into Ordermentum with EVP partner Damon Pezaro backing the business late last year.
“As investors in Foodbomb, it is exciting to align two exceptional teams, strong technology products and significant customer footprints, and to continue on our collective mission to build one of Australia’s generational software firms in combination with Ordermentum,” Lipman said.
“In our view, the combined business is now well positioned, with a strong balance sheet, to continue growing share as a result of its clear market leadership position within Australia’s hospitality sector.”
The deal comes at a time when capital is tight and many are predicting that mergers and acquisitions will be a key pathway for startups to scale and deliver growth in a slowing economy.
Foodbomb has shown strong traction over its six years, processing more than $100 million in orders from 13,000 venues. The founders will continue in the business under the company’s new owners, with Tory, a veteran of wholesale meat sales, saying they were approached by Odermentum founder Adam Theobald last year about a potential merger. Ordermentum has around 40,000 users on its database.
“I have no doubt that the coming together of Ordermentum and Foodbomb will create an unrivalled powerhouse in the wholesale food and beverage industry,” he said.
His cofounder Josh Goulburn said the merger gives both startups “the opportunity to really accelerate and solidify our position as the most dominant force in the space”.
It’s the third years in a row Ordermentum has tapped the market for more cash, pulling in another $16 million, just 10 months after it raised $6.2 million in November last year.
The nine-year-old venture previously raised $2.5 million in 2017 and then $5 million in February 2021, before a secondary market sale later that year saw investor RoZetta sell its stake as the bulk of a $6 million round.
Launched in 2014 by Theobold, cofounder of payments app Hey You, and former Toby’s Estate MD Andrew Low, the initial focus was on coffee before the B2B software platform shifted into the broader food and beverage ordering market.
The latest capital injection saw ASX-listed VC Touch Ventures join the cap table along with Microequities Asset Management and Aditum Ventures.
Existing backers, including SEEK cofounder Matt Rockman, NIB Holdings chair David Gordon and Perennial Private Ventures Fund also chipped in.