Deal Scoop: Venture Capitalists Recap Exit41
An OpenTable for takeout?
That’s the new plan for Exit41, a Massachusetts-based company that has quietly raised $6 million in VC recap funding. New investors include GrandBanks Capital, Contour Venture Partners and Dace Ventures, while existing shareholder Fidelity Investments also participated (others, like Thomas Weisel Venture Partners, did not).
The company was launched in 1998 as Elm Square Technologies, as point-of-sale enterprise software for restaurants and caterers to manage orders. It later changed its name to Exit41, and began supplying fast-food chains with technology that better enabled drive-thru ordering systems.
The new recap round, which wipes out more than $20 million in prior VC investment, also reflects yet another strategic change. Exit41 now is trying to scale a platform on which customers can order take-out meals without having to use the phone. Again, OpenTable for takeout.
Tim Wright, a partner with GrandBanks, says that the system not only will make orders more efficient for consumers, but also should help make restaurants more money.
“When consumers see an entire menu as a giant checklist, they’re more likely to order that piece of cake or other item they weren’t originally expecting to order,” Wright explains. “Plus, you won’t need restaurant employees to spend time taking down as many orders.”
Exit41 plans to sell directly to large chains, and has ten distributors focused on adding the services to independent restaurants. There also are hopes to eventually adapt the technology for the hospitality space, but those plans are not yet in place.
Wright says that the company does not expect to raise additional VC funding.
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