Online catering startup Platterz feeds on Toronto tech sector

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Toronto's booming tech sector has pushed down office vacancy rates, driven up demand for engineering talent – and helped turn an online catering service called Platterz Inc. into one of Canada's fastest-growing startups.

Platterz, founded in 2015 by Israeli-Canadian entrepreneurs Eran Henig and Yishay Waxman, is announcing on Thursday that it has raised US$15-million in venture financing after securing some of the top tech companies operating in the Toronto-Waterloo corridor as regular customers. The deal is being led by Israeli venture-capital firm Aleph and backed by past investors AltaIR Capital, an Israeli VC firm, and Tony Lacavera's Globalive Capital.

Shopify Inc., Facebook Inc., Apple Inc., Twitter Inc., LinkedIn Corp., Uber Technologies Inc. and salesforce.com are among the Platterz tech customers who regularly feed their local employees breakfast, lunch and/or snacks, one of the perks of working in the fast-growing sector in which talent is in demand and employees spend long hours at work. Shopify alone orders hundreds of meals several times a week through Platterz for employees in its Waterloo, Ont., Toronto and Montreal offices. With a solid foothold in New York, Platterz is now starting to expand to other urban centres across North America. "We feel there's an opportunity to dominate corporate catering," said Mr. Waxman, the 45-year-old president.

Platterz is one of many companies that have crowded into the technology-enabled food-delivery market, attracting heavy interest from venture capitalists but a cooler response so far from the public markets. Vancouver-based Foodee, ZeroCater and Chewse of San Francisco and Boston's ezCater have all raised venture backing for their own online catering services, while consumer-oriented home meal-kit delivery companies Blue Apron Holdings Inc., HelloFresh SE and Montreal's Goodfood Market Corp. have gone public in the past year with mixed results. Winnipeg-based restaurant delivery service SkipTheDishes Restaurant Services Inc., meanwhile, sold to Britain-based rival Just Eat PLC in 2016 for $110-million.

Platterz is a software company itself: It doesn't make or deliver the food, but provides a digital ordering platform that connects corporate customers to hundreds of local restaurants in its core markets of Toronto and New York; Mr. Henig estimates its 50 top vendors in Toronto are making $100,000 apiece on an annualized basis. It also bills itself as an artificial-intelligence company, using its "predictive meal builder" software to help office staff put together food orders with a few clicks and remembering past orders and preferences to serve up meal recommendations. The whole ordering process takes a handful of minutes, simplifying and speeding up the typical ordering task while providing greater variety than most standard caterers.

"The corporate catering market that they operate in is very big and also a bit underserved," said Aaron Rosenson, an Aleph general partner.

After two years in operation, Platterz has more than 1,200 customers, including such corporate stalwarts as Deloitte, Thomson Reuters and Toronto-Dominion Bank, although nearly 50 per cent are drawn from the tech sector. Total food sales have tripled in the past year to a rate of more than US$1-million a month (Platterz takes a cut of that amount, billed by its restaurant partners, in the range of 15 per cent to 25 per cent and staff have doubled to 50 employees since last year. "Definitely, without a strong [tech] ecosystem in Toronto we would not have been able to have the strong testing ground to build our foundation," said Mr. Henig, the CEO.

He said he was inspired to start Platterz by an Israeli burger chain that delivers a platter for four people with burgers, chips and onion rings. "The enjoyment you get by splitting that meal with three friends is fantastic," the 33-year-old Mr. Henig said. "That's the experience we're trying to bring back to the corporate world."

Vasha Zindros, co-owner of Mezes, a Greek restaurant on Toronto's Danforth Avenue, said she was looking to expand into corporate catering when Platterz cold-called 18 months ago. Signing on with Platterz required her business to better organize its ordering and food-preparation activities. But the catering orders have also boosted her sales by 15 per cent in the past year. "It's really hard for small businesses, we need to find ways to maximize longevity and make it work," she said.