Uber buys catering marketplace ezCater for $2.3B

Uber is buying catering company ezCater, extending the range of services available through its Uber Eats division. The all-cash transaction is valued at $2.3 billion.

Billed as a “leading U.S. platform for catering and workplace meals,” ezCater is a marketplace connecting businesses that need large meals with the restaurants that can supply them — something like an Expedia for catering. Founded in 2007, the company was bootstrapped for seven years before raising its first $4 million round in 2014, and has since grown into a business that generated over $2.5 billion in gross bookings over the last 12 months, according to Uber. For a company with that history, the deal represents a significant exit.

Uber CEO Dara Khosrowshahi framed the acquisition as a way for restaurants to reach larger customers. “Catering is a big business, and can be a huge revenue stream for restaurants,” he said in a statement. “With Uber’s reach, we can bring that experience to millions more customers and help restaurants win more of these valuable orders.”

The acquisition continues a run of moves by Uber to expand its food-delivery business. The company is also in the process of buying Delivery Hero for $15 billion, and is investing in — and partnering with — drone-delivery companies including Zipline and Flytrex.

Why it matters

The ezCater deal gives Uber a ready-made foothold in business catering, a segment with higher order values than typical consumer delivery, as the company keeps building out Uber Eats beyond individual meal orders.