Toast, Inc. (Toast) operates as a cloud-based, all-in-one digital technology platform purpose-built for the entire restaurant community.
The company provides a comprehensive platform of software-as-a-service, or SaaS, products and financial technology solutions, including integrated payment processing, restaurant-grade hardware, and a broad ecosystem of third-party partners. It serves as the restaurant operating system, connecting front-of-house and back-of-house operations across service model...
Toast, Inc. (Toast) operates as a cloud-based, all-in-one digital technology platform purpose-built for the entire restaurant community.
The company provides a comprehensive platform of software-as-a-service, or SaaS, products and financial technology solutions, including integrated payment processing, restaurant-grade hardware, and a broad ecosystem of third-party partners. It serves as the restaurant operating system, connecting front-of-house and back-of-house operations across service models, including dine-in, takeout, delivery, catering, and retail.
Products and Platform
Toast’s all-in-one technology platform is purpose-built for the food and beverage community. The company’s proprietary Android-based software powers its single platform of vertically integrated solutions with seamless connectivity across the operations of its customers, their guests, and their employees.
The company’s technology supports restaurants of all types and sizes, as well as food and beverage retailers; its product portfolio covers the critical needs of its customers: taking orders and payments, managing a digital presence, driving guest traffic, labor management, supply chain, and accounting, among others. Alongside this platform, the company’s commitment to customer success helps drive a differentiated customer experience, power operational innovation, and enable its and its customers' long-term growth and success.
As customers use more of the company’s platform, its solutions work together to create opportunities for better outcomes, enabling greater success for its customers. For example, restaurants that adopt the company’s digital ordering solutions, such as Online Ordering and Order & Pay, can unlock synergies with Toast’s marketing and loyalty programs, increasing the likelihood of return visits, and even driving more guests to the restaurant’s online ordering channel with Toast, which can help restaurants save on third-party commissions and deliver incremental margins for the restaurant.
Point-of-Sale (POS) & Restaurant Operations
Toast’s in-store POS and restaurant operations offerings are built to help reduce time to take an order, optimize operations, and seamlessly handle payments. This includes software to run fixed-location POS terminals, handheld POS devices, and self-service kiosks that allow restaurant staff to take orders and guests to pay, all of which run on Toast hardware with proprietary technology. In the kitchen, its Kitchen Display System and kitchen printers allow operators to integrate in-store and online orders, helping keep kitchen staff organized and driving operational efficiencies.
Robust above-store offerings include the company’s multi-location management and menu management tools that allow operators to configure its products to fit the specific needs of individual locations while also providing customers with the ability to view data across their locations for a centralized, clear view of business performance.
Marketing
Toast’s marketing products provide simple, integrated solutions to deliver targeted email and SMS campaigns, build loyalty programs, offer gift cards, and take reservations to drive further engagement with a restaurant’s guests.
Features within the company’s marketing products, such as its writing assistant powered by artificial intelligence, or AI, custom templates, and one-click email campaigns, are designed to help operators save time on crafting marketing strategies. Additionally, certain of the company’s products enable operators to create tailored marketing based on guest interactions across its product suite, such as visit frequency and spending patterns, to drive guest engagement and help improve retention. Data-driven insights within these products allow operators to easily create and optimize their marketing efforts over time.
Online Ordering & Delivery
The company provides software solutions that allow customers to take control of and consolidate digital ordering and delivery across Toast-provided solutions and third-party ordering channels. Toast’s Websites and Branded App products aim to simplify building and managing a restaurant’s digital presence with templates and real-time menu updates integrated with the POS system. The company’s commission-free, first-party online ordering product and the consumer Local by Toast application are designed to simplify the digital ordering experience for guests, increase order accuracy, and allow restaurants to reduce reliance on third parties for driving online orders. It enables restaurants to offer delivery services in a variety of ways that can be tailored to the different needs and operations of restaurants. With the company’s POS integrations, restaurants can streamline order intake, eliminate the need for third-party tablets, and seamlessly sync menus.
Team Management
Toast’s payroll and team management products offer a centralized hub that streamlines the employee onboarding, management, and payroll process. Integrated POS and payroll creates a single employee record across systems, allowing for hours, tips, and employee data to synchronize seamlessly - helping managers save time and improving the employee experience. The company’s scheduling products facilitate simple shift scheduling, shift swapping, and team communication to keep the whole team in sync.
Vendor Management
Toast’s vendor management offerings are built to help operators make more informed, data-driven decisions by integrating key data and automating processes to provide actionable insights across the back office. It enables operators to better manage costs and spend less time on administrative tasks - allowing them to focus more on their guests and teams.
xtraCHEF by Toast provides a comprehensive set of back-office tools for restaurants, including accounts payable automation, inventory management, ingredient price tracking, and recipe costing. By integrating POS, Toast Payroll, accounting software, and supplier data, it provides operators with valuable insights to help manage fluctuating costs, automate financial processes, and optimize back-office tasks to proactively manage margins.
Retail
Toast's food and beverage retail offering helps restaurants, convenience stores, bottle shops, and grocery stores of all shapes, sizes, and concepts save time, streamline inventory management, and enhance the customer experience. With Toast’s mobile-first SmartScan technology, operators can scan an item’s barcode with their mobile device and pull key information into their POS, including an item’s name, brand, a high-quality image, and an AI-generated recommended description. Additionally, Toast’s smart inventory planning capabilities use historical sales data to predict the number of days before a retail item runs out on the shelf, enabling operators to plan ahead.
Food and beverage retailers can also leverage the rest of the Toast platform to manage their employees, finances, and guest touchpoints. For operators of hybrid restaurant and retail establishments, they can use one consolidated POS, reducing operational complexity and training needs, and use unified reporting tools to see a complete picture of their operations.
Financial Technology Solutions
Toast provides a fully integrated platform that enables the company’s customers to securely accept and process payments, while also providing valuable data-driven insights and driving its guest engagement programs.
The company also offers a number of ways for customers to reduce the upfront cost of its products. With an Easy Pay commercial lease, Toast customers can get up and running quickly while minimizing their upfront costs, paying for hardware and onboarding fees generally through a portion of their daily transactions. The company also helps tackle rising daily payment processing costs by offering automated, industry-compliant credit card surcharging to help eligible customers offset their card processing fees.
Toast Capital offers eligible restaurants access to fast and flexible funding via loans issued by the company’s bank partner that are generally repaid through a portion of their daily transactions. It is uniquely positioned to provide its restaurants with access to capital using proprietary systems to assist with loan origination that incorporate data science models, historical POS data, and payment processing volume. Toast Capital provides applicants with a straightforward process that allows approved borrowers access to funds as soon as the next business day after signing a credit agreement, allowing restaurateurs to focus on running and growing their businesses.
Technology
The company’s proprietary technology underpins its products to provide a streamlined, integrated customer experience. The company’s platform is designed to be stable and secure, and provides its individual product teams common capabilities, shared services, and reusable components to build new products efficiently.
The company’s digital technology platform includes:
Software, cloud-based services, and partner ecosystem.
Reliable cloud services: The company’s highly scalable, services-based, multi-tenant architecture runs on Amazon Web Services.
Offline POS capabilities: In the event of an internet or network disruption, Toast’s offline POS capabilities provide essential continuity of operations. This capability allows customers to continue to place orders, send orders to Kitchen Display Systems, print tickets and receipts, and take credit card payments. In offline mode, credit card information is securely encrypted and stored on the Toast device until it regains connection.
Partner APIs: Toast has curated a portfolio of over 200 restaurant technology partners that utilize Toast APIs to deliver a broad range of specialized solutions.
Payments
Toast provides fast and secure, integrated payment processing through its POS devices, standalone contactless reader, or Toast Tap reader, and online ordering applications.
Security and Compliance: Toast is a PCI-DSS compliant Level 1 Service Provider. All of the company’s card processing products and services are assessed annually by an independent security organization that has been qualified by the PCI Security Standards Council to validate an entity's adherence to PCI-DSS.
Reliability: The company leverages its extensive on-the-ground experience to provide a reliable payments experience that is resilient to issues with restaurants’ networks or internet service providers, as well as Toast’s own cloud platform.
Flexible Omni-Channel Capabilities: Toast provides in-store, digital, and partner payment capabilities. In-store payments through the Toast integrated card reader and Toast Tap reader support card dipping, tapping, and swiping, as well as Apple Pay, Google Pay, and Samsung Pay, with fraud detection capabilities to minimize transaction risks. Using Toast-provided payments across channels simplifies the company’s customers’ experience, providing them with a single daily deposit of funds and consolidated reporting for easier accounting.
Hardware
User-Friendly, Durable, and Designed To Last: The company’s custom-designed hardware is pre-configured to enable self-installation with limited support and is created to be restaurant-grade for spills and drops, with a long battery life.
Device Management: The company’s hardware utilizes the open-source Android mobile operating system, which enables it to freely distribute the operating system to the Toast terminal and handheld devices. Proprietary management tools are designed to allow Toast to safely and efficiently upgrade POS software and device firmware, as well as to monitor the health of devices across the fleet.
Growth Strategy
The company’s strategy is to continue to invest in areas that align with its customers’ needs and strategically open up new markets to serve new customer types. It expects that both it and its customers will continue to realize the value of its platform as it scales, makes enhancements to its technology, offers more products and services, and helps its customers increase revenue while saving time and money. Toast both drives and benefits from the success of its customers—when they grow, Toast grows through higher payments volume and increased adoption of the company’s full platform.
The company’s strategies are to fuel efficient location growth in its core U.S. market; expand the company’s addressable market; increase adoption of the company’s products; invest in and expand the company’s product platform; further develop the company’s partner ecosystem; and selectively pursue inorganic growth.
Sales and Marketing
The company’s sales and marketing motion is designed from the ground up to integrate into this dynamic by combining a high-volume marketing engine with a localized and consultative sales force.
The company starts with in-market sales teams that are deeply familiar with, and trusted by, the local community. This deep knowledge of the local food and beverage scene provides it with a competitive advantage. The company’s sales team consists of an acquisition team that is focused on new location growth and is organized by restaurant size (i.e., number of locations per customer), type, and geography. The acquisition team is complemented by a customer growth team that focuses on expansion into the install base.
To generate and capture demand, the company invests heavily in the primary discovery channels for restaurant and food and beverage retail operators. It combines its demand generation efforts with pricing and packaging that is designed to increase platform adoption and simplify the buying process for restaurants. This approach provides multiple entry points into the Toast platform, ranging from a single terminal point of sale to a multi-product setup for a complex restaurant or food and beverage retail operation.
As Toast continues to grow, so does the importance of brand recognition and the company’s investments into strengthening it.
Seasonality
The company experiences seasonality in its financial technology revenue, which is largely driven by the level of payment volume processed through its platform. For example, the company’s average customers typically have greater sales during the warmer months, though this seasonal effect varies regionally. As a result, its financial technology revenue per location has historically been stronger in the second and third quarters (year ended December 31, 2024).
Intellectual Property
As of December 31, 2024, the company had 65 U.S. patent applications allowed/granted, and in addition, it has 6 U.S. patent applications pending. The company’s issued patents are estimated to expire between 2034 and 2042. In addition, it has registered domain names for websites that it uses in its business, such as www.toasttab.com and other variations.
Government Regulation
Certain of the company’s payment technology solutions are or may become subject to anti-money laundering laws and regulations under the Bank Secrecy Act of 1970, as amended by the USA PATRIOT Act of 2001, or the BSA. The BSA requires certain financial institutions, including banks and money services businesses, or MSBs (such as money transmitters), to register with the Treasury Department’s Financial Crimes Enforcement Network, or FinCEN, as MSBs and to develop and implement risk-based anti-money laundering programs, report large cash transactions and suspicious activity, and maintain transaction records, among other things.
The company’s subsidiary, Toast Processing Services LLC, or TPS, is registered as an MSB with FinCEN in its capacity as a money transmitter. As an MSB, it is required to maintain a written anti-money laundering program, or AML Program, that meets the standards set forth in the FinCEN regulations implementing the BSA. In addition, the company’s AML Program is designed to address and comply with the Money Laundering Control Act and other U.S. laws and regulations regarding anti-money laundering and countering the financing of terrorism, which it refers to as AML/CFT, and to control for the AML/CFT risks inherent to its business. The AML Program is also designed to prevent the company’s platform from being used to facilitate business with certain individuals, entities, countries, and territories that are targets of economic or trade sanctions, including those imposed by the Treasury Department’s Office of Foreign Assets Control.
The company’s subsidiary, Toast Insurance Services, Inc., has obtained certain insurance-related licenses from all 50 states plus Washington, D.C. The payment networks and their member financial institutions routinely update, generally expand, and modify requirements applicable to the company’s customers, including rules regulating data integrity, third-party relationships, merchant chargeback standards, and compliance with the Payment Card Industry Data Security Standard, or PCI DSS.
The company is also subject to the operating rules of Nacha, formerly the National Automated Clearing House Association. Nacha is a self-regulatory organization that administers and facilitates private-sector operating rules for ACH payments and defines the roles and responsibilities of financial institutions and other ACH network participants.
Together with the company’s bank partner, it offers a payroll card, which allows the restaurant’s employees to receive wages, tips, and other compensation from their employers. These debit cards are subject to federal and state financial services laws, as well as the payment card network rules and Nacha Rules. The Durbin Amendment to the Dodd-Frank Act and its implementing regulation, Regulation II, limit the amount of interchange revenue that the bank partner may receive, and share with the company, on transactions made using these cards.
Under certain U.S. federal laws, including, for example, the Gramm-Leach-Bliley Act, or GLBA, and Regulation P promulgated thereunder, it must disclose its privacy policy and practices, including those policies relating to the sharing of nonpublic personal information with third parties.
The U.S. state consumer privacy laws, including the California Consumer Privacy Act, or the CCPA, as amended by the California Privacy Rights Act, has directly impacted the company’s business operations in that it has created data use, sharing, and transparency requirements and provides California residents certain rights concerning their personal information, such as access, correction, deletion, and opt-out of selling or sharing such data. In addition to the CCPA, numerous other states have enacted similar consumer privacy laws. The company expects the number of states with such laws to continue to grow over time. While personal information that it processes that is subject to the GLBA is exempt from the CCPA and many of these other state laws, the CCPA and these additional state laws will regulate other personal information that it collects and processes and impose new consumer rights and limitations around personal information.
Additionally, as the company grows its business internationally, international privacy legislation, such as the European Union General Data Protection Regulation, or the EU GDPR, and the EU GDPR in such form as incorporated into the laws of the United Kingdom, or UK GDPR, collectively with EU GDPR referred to as GDPR, and Canada’s Personal Information Protection and Electronic Documents Act along with provincial legislation similarly impact the company’s operations on account of requirements related to collecting, processing, and cross-border transfers of personal information.
History
The company was founded in 2011. The company was incorporated under the laws of Delaware in 2011. The company was formerly known as Opti Systems, Inc. and changed its name to Toast, Inc. in 2012.
