Online Food Ordering Company Olo Files For IPO: What We Know So Far
Online food ordering and delivery company Olo filed an S-1 document with the SEC late last week as part of its plan to raise up to $100 million in an initial public offering.
About Olo: Olo provides an on-demand commerce platform for multilocation restaurant brands that enables digital ordering and delivery.
Some of the more notable clients that exclusively use Olo's cloud-based platform include Wingstop Inc (NASDAQ: WING), Shake Shack Inc (NYSE: SHAK), Denny's Corp (NASDAQ: DENN) and many other chains. In total, the company said it services 400 brands at 64,000 locations and facilitates 1.8 million orders per day.
"Restaurant brands rely on Olo to increase their digital and in-store sales, maximize profitability, establish and maintain direct consumer relationships, and collect, protect and leverage valuable consumer data," the company said in its S-1.
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Olo believes that the advancement of technology that lets people shop online should be treated to the same digital experience from restaurants.
However, many restaurants lack the technological knowledge to deploy such a solution, so they rely on companies like Olo to help generate a superior consumer experience.
Olo generates revenue from both subscription and transaction-based revenue streams. For the years 2018, 2019 and 2020, 93.2%, 80.8% and 56.7% of revenue were from subscriptions.
Financial Details: The company ended 2020 with cash and cash equivalents of $75.8 million and zero outstanding debt.
Revenue rose from $31.8 million in 2018 to $50.7 million in 2019 and $98.4 million in 2020.
Gross profit improved from $21 million in 2018 to $35.1 million in 2019 and $79.8 million in 2020. Gross margins as of 2020 were 81%, and the operating margin came in at 16%.
IPO Plans: Olo said it expects to use the proceeds from its IPO for general corporate purposes, including working capital, operating expense and capital expenditures. The company may use some of the proceeds to acquire complementary businesses, products, services or technologies.
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