The Uber ezCater acquisition announced Tuesday, Oct. 6, will put one of Boston’s best-known homegrown tech companies inside Uber. The San Francisco ride-hailing and delivery company said it agreed to buy ezCater, the Financial District-based workplace catering platform, in an all-cash deal valued at $2.3 billion, according to the joint announcement from the two companies.
The deal landed one day after another large Boston software sale, Schneider Electric’s $22.6 billion agreement to buy Seaport-based PTC, giving the city two headline acquisitions in back-to-back days.
What Uber Is Buying in ezCater
ezCater was founded in 2007 as an online marketplace for businesses that need large food orders from local restaurants, the Boston Globe reported. According to the companies’ announcement:
- ezCater works with more than 140,000 restaurants nationwide.
- It generated more than $2.5 billion in gross bookings over the trailing 12 months, growing in the “high teens” year over year.
- The business is profitable on a non-GAAP operating income basis, and its average order value is above $400.
The Globe reported that ezCater has kept its workforce at roughly 900 employees, about 300 of them in Boston. The Boston Business Journal identified the company’s base as 40 Water Street downtown.
How the Deal Fits Uber Eats and Uber for Business
Uber said ezCater’s catering and business-to-business tools will be combined with Uber Eats and Uber for Business, its corporate accounts product. The companies said restaurants would gain access to larger orders and new customers, while Uber Eats couriers would get new earning opportunities.
“Catering is a big business, and can be a huge revenue stream for restaurants,” Uber CEO Dara Khosrowshahi said in the announcement. ezCater CEO Nihad Rahman said the team was “energized to bring our catering and B2B expertise to Uber’s global ecosystem.”
The transaction is expected to close in the coming months, subject to regulatory approvals and customary closing conditions. J.P. Morgan advised Uber, and Evercore advised ezCater, according to the release.
What It Means for Boston’s Tech Scene
The Globe described the sale as a quick exit for a local company that had once discussed going public on its own, and noted that many in Boston remember Uber’s 2021 purchase of Boston liquor-delivery startup Drizly for about $1 billion, a brand Uber shut down roughly three years later. The companies’ announcement did not address ezCater’s Boston headcount or office.
The deal follows a busy stretch of Boston corporate news, including the $2.9 billion Vicinity Energy steam-system sale and legal AI company Harvey’s new Boston office.
Our Take
This section is analysis and opinion, separate from the reporting above.
For Boston, the price is a vote of confidence: a profitable, Boston-built company with $2.5 billion in annual bookings is exactly the kind of business the city wants to grow here. The open question is what happens after the cash changes hands. Drizly is the cautionary tale, and the most useful thing Uber could do for its Boston reputation is say early and plainly whether ezCater’s roughly 300 local jobs and its downtown office will stay. Two big local companies sold in two days also says something about the city’s tech economy. Boston keeps producing companies that are worth buying, but fewer of them are staying independent long enough to become the next big local headquarters.