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08/05/2021

Lunchbox Acquires Spread, to Create No-Commission Delivery Platform

Lunchbox will help mom-and-pop restaurants break their reliance on third-party marketplace delivery apps.
Anna Wolfe
Senior Editor - Restaurants
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Lunchbox, an online ordering engine for restaurants, has struck a deal to buy Spread, an online marketplace that connects restaurants with diners, offers delivery and take-out services without having to pay third-party marketplace commissions.

This acquisition position Lunchbox to help restaurants build leading-edge digital products to help strengthen the guest-restaurant relationship and bolster their bottom lines with commission-free food ordering and delivery.

Delivery Fees

During the pandemic, more cities, states took aim at third-party delivery fees.  Third-party delivery marketplaces provided increased reach and marketing power for brands big and small. However, third-party delivery fees were increasingly under fire as many restaurants, with dining rooms closed, depended on off-prem to survive. Chicago, Philadelphia, Portland, Ore., San Francisco, New York and Seattle were among the cities that moved in 2020 to cap third-party delivery fees, at least temporarily during the pandemic.

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Lunchbox delivery guy on bike

As Lunchbox currently serves multi-unit restaurants, the acquisition of Spread allows the company to now service restaurants of all sizes, including single-location and mom-and-pop eateries. Now, smaller restaurants can have access to critical customer data which can help them drive increased sales. This platform also has multiple applications and can be focused on target neighborhoods or even be used as a city-run marketplace.

Nabeel Alamgir, CEO and co-founder of Lunchbox, said. "Restaurants will no longer have to give up 15-30% of their online order costs in order to compete with other restaurants and keep their doors open. Now they can process orders online completely free, and create more meaningful relationships with customers as they now have access to diner data."

A Big Apple Debut

The Spread marketplace launched in late 2020 in New York City with 1,500+ restaurants on the platform and $3M+ orders. With the new marketplace, single-location and mom-and-pop restaurants will be able to band together and provide a platform that allows patrons to make on-demand orders directly from their digital storefront.

"We created Spread to answer the question: What would it look like if restaurants banded together and built their own marketplace?" said Andy Wang, co-founder and CEO of Spread. "With this acquisition, we're able to bring our platform to millions of diners who want access to a more ethical delivery platform that helps restaurants stay profitable. I'm thrilled to be joining the Lunchbox team to spearhead this new platform and help restaurants see greater returns."

This acquisition will push Lunchbox beyond a white-labeled ordering platform, allowing the company to explore a new business model that complements its current focus area on building next-gen direct ordering while also investing in a sustainable marketplace created by restaurant people for the restaurant industry.