August 12, 2022

Flight Plan #014 - Our Investment in Mr Yum - The Next Course

Announcing our third investment into Mr Yum. A beautiful QR-Code ordering suite for hospitality.

Written by

Stew Glynn

We joined the Mr Yum rocketship through TEN13 as lead investors in their Seed round in late 2020, and there are so many things to point to that get us excited about what's happened but more importantly, what's ahead. Hence, we're excited to be refuelling the ship, and supporting them for the third time in their recently publicised US$65m Series A.

The Mr Yum team has ambition, move at pace, don't pretend to know it all, keep it real, live their culture, fight for their customers, and are assembling a kick-ass team to change the face of mobile ordering. We're lucky to be part of the journey.

We couldn't be more excited for founders, Kim, Adrian, Kez, and Andrei on what they've achieved so far (2021 has been huge) plus the future ahead with their ambitious plans and now the depth of funding to really invest across product, team, geographic expansion and more. It's been awesome to see these founders and the wider Mr Yum in action.

When talking through Mr Yum's mantras, it's clear that these flow through their culture from the founders down to new hires and can be seen on daily basis:

  • Run towards the fire - In their case, this was Kim & Adrian (co-founders) moving to the US in the midst of COVID, to go after the opportunity and the massive market. Leaving the fortress of Australia did not seem to deter them vs. most who stayed home whilst the COVID storm played out. I'm not sure they even told their parents that they were in the US for the first few months! Growing internationally was important and thus they made the sacrifice to make it happen."
  • Think 10x - Why launch one major market, when you can launch two. Mr Yum had raging success within the Australian market, scaling very rapidly and gathering significant user adoption. The team saw an opportunity in both the US and UK to launch and scale into these markets too, they moved core team members from Australia to enable a running start and hired awesome folks on the ground into both markets to kickoff at pace. Anyone that has launched a new market knows that it's not easy, thus launching two major markets at once was a challenge, albeit one they were keen to conquer.
  • Here to serve - Mr Yum has always sided with the hospitality industry and looked to help support whether it's launching a new pickup / delivery product in the peak of lockdowns, building and launching a tool to search restaurants within a 5km radius (to comply with lockdown laws), or lobbying the government to get more support. Mr Yum goes to bat for their customers, and it shows with loyalty and overwhelming industry goodwill.

It's no surprise that with this level of determination and ambition, they were able to gain the attention of some of the world's most internationally renowned growth stage investors. After a competitive fundraising process, we're excited to partner with Tiger Global as the lead investor in their Series A. Apart from being one of the most active VC investors globally, Tiger is also the largest pre-IPO shareholder of Toast ($16.8bn market cap) and Olo ($3.4bn market cap) and are some of the strongest consumer & foodtech investors.

Mr Yum's Series A round is the largest by a female-led company and the third-largest in Australian history (after Judo Bank & Octopus Deploy, according to Crunchbase). This level of commitment is an exceptionally strong & positive signal especially coming from some of the most successful global venture funds and investors.

Armed with a war chest of USD$65m+ (AUD$89m) post this round, Mr Yum is set for its next growth phase and are aggressively setting their ambition towards winning the global mass-market mobile order and payments opportunity within the hospitality industry.

Cofounders reunited in London (L-R) - Kim Teo, Adrian Osman, Kerry Osborn, and Andrei Miulescu

Vision:

Mr Yum aims to become the global leader in mobile ordering, payments, and growth tools for restaurants and venues globally, bringing the world's best menu ordering experience to customers.

We believe Mr Yum is leading the shift from static printed menus to customised & personalised virtual menus and ordering.

Source: Let CXO and Co-Founder Kerry Osborn talk you through the future of mobile ordering

Why Now? Timing:

We are at the beginning of a decade-long shift in the way consumers order and pay for food and drinks.

  1. Global staff shortages, COVID-19, and eroding margins are forcing the industry to adapt its service model.
  2. In the post-COVID-19 recovery boom, many restaurants and venues are struggling to hire and retain staff. Venues need to leverage technology solutions to increase the output of their reduced staffing and in order to serve the bounce-back in customer numbers.
  3. In addition, 'invisible' inflation and pressure are hitting restaurants and bars hard in the wake of COVID-19 - in September the US had inflation rates hitting 5.4% and 6.2% in October - the fastest since 1991. This will again start to eat at venue margins and hurt operators.
  4. Lockdowns triggered a permanent mass adoption of online ordering technology and the industry/consumers discovered the **power of QR-codes** and what you can do with customer data.
  5. In the context of QR Code Adoption and the level of penetration of understanding amongst all generations, we think that the timing is perfect for a QR code-enabled mobile digital ordering platform to revolutionise the in-person dining experience.

These market conditions have opened up a massive, global fintech and data opportunity to shift the ordering experience from offline to online.

Product:

Mr Yum is a web-based mobile menu, payments, and marketing platform for the hospitality and entertainment industries. Mr Yum integrates with the major POS providers which serve as a distribution channel for the company.

Mr Yum provides its customers with beautiful visual menus, in-venue QR-ordering, delivery / pickup ordering, loyalty offerings, and customer engagement features.

The product includes:

  • Beautiful visual menus - currently free of charge, great initial value add for venues.
  • In-venue QR ordering - Mr Yum charges a fixed % card fee for all transactions processed through their platform.
  • Delivery/pickup ordering - Mr Yum charges a similar % card fee for delivery/pick-up orders processed through their platform.
  • Loyalty offering to help venues to build deeper relationships with their customer base with loyalty and rewards offerings.

Through these offerings, Mr Yum helps customers:

  • Generate 20-45% in increased spend per customer (average order value) through enticing photos, more efficient ordering (no queueing or getting waiters attention), up-selling and cross-selling of deals; and
  • Save 5-15% in labour costs by reducing the headcount needed to manually take orders and payments thus becoming more efficient and profitable.

Check out these videos to see how the product works and action and to hear some customer testimonials:

Venues

The thousands venues onboard each log into Mr Yum to a sophisticated management system where they can review their menu, change their offers, review live orders, input orders ready for distribution, and complete orders in real-time, all in a familiar web browser. No apps or hardware are needed.

International Expansion: US and UK Market Entry

With our support and urging on, Kim and Adrian packed up their bags in February of this year and flew to the US to personally execute their US and UK plans. This ambition is paying dividends as they develop core relationships with partners, understand the market dynamics and build solutions that are winning in each market.

In mid-2021, Mr Yum had already identified the UK as a key market to launch in. The UK has a very strong pub culture and a digital menu table-ordering product like Mr Yum was mooted as a natural from a product-market fit standpoint.

The team launched and has been ramping their growth aggressively. Assisted by the tailwinds of UK 'Freedom Day', Mr Yum also partnered with Taste of London, one of the world's largest food festivals, and will be showcasing their offering at the VIP section of the festival in November.

The proceeds of this Series A round will be used to turbocharge Mr Yum's international expansion.

Last but not least, the Mr Yum team 👨‍👩‍👧‍👦

Mr Yum has worked exceptionally hard on building a culture that will attract world-class talent and be a fun and engaging place to work. This is a necessary win condition in today's hyper-competitive hiring market.

Kim shares here on how she thinks about culture. And is being reflected in results such as being named the #4 most exciting startup to work for in Australia.

Their team has grown to 100+ over the last year and will likely double again this year with their growth plans. Here are some of the high-calibre hires who have recently joined the Mr Yum team (welcome!):

And of course, Mr Yum is hiring in bulk, see open positions here and a video on what it's like to be part of Mr Yum below.

We're excited to be fuelling Mr Yum once again. Mobile ordering to the moon 🚀

Thanks for letting us onboard once again - Kim, Adrian, Kez, and Andrei 🙏

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