In May 2023, we released our first Restaurant Tech Index, spotlighting the rapid growth of Toast POS in the restaurant industry. Fueled by its all-in-one platform and rising adoption among multi-unit operators, Toast was making significant strides. If you missed it, you can catch up on our findings here. At the time, we noted Toast’s aggressive expansion into new sectors and its strategic moves to capture a larger market share, particularly within the mid-market and enterprise segments.

Earlier this year, we revisited Toast’s progress in our 2023 Market Pulse industry report, which offered fresh insights into the company’s evolving strategy and sustained growth. Notably, in late 2023, we identified a new Toast service emerging on multi-unit websites—a feature designed to seamlessly manage large catering orders and events. This early detection was later confirmed in Toast’s Q2 2024 financial statement, showcasing Restaurantology’s unique ability to surface industry shifts well before they become public knowledge.

As we revisit Toast’s journey over the past year, we’ll once again validate their reported growth through the lens of Restaurantology’s market intelligence, offering a deeper analysis of how Toast continues to expand its footprint and what this means for the broader restaurant industry.

Continued long-tail expansion

Toast’s Q2 2024 financial results tell a compelling story of growth. With ARR reaching $1.5 billion—a 29% increase year-over-year—and a total of approximately 120,000 locations, Toast’s trajectory remains upward. Their Gross Payment Volume (GPV) increased by 26%, further demonstrating widespread adoption.

While Toast’s financial report broadly alludes to the successes they’ve found both internationally and in new verticals, the core of their year-over-year growth likely stems from their longstanding stronghold: the restaurant industry long-tail.

Toast has consistently excelled in a space where many restaurant tech companies struggle or deliberately avoid: the smaller, independent operators. Unlike others, Toast has crafted a business model that embraces selling software to “mom-and-pop” restaurants—a segment often overlooked due to the high customer acquisition cost (CAC) and the volatility of these businesses. For those unfamiliar, targeting restaurant concepts with fewer than five units can be particularly challenging in a GTM strategy.

Read more: Why it’s difficult selling to “mom-and-pop” restaurants →

Restaurantology’s market intelligence confirms the rising adoption of Toast among sub-20 multi-unit operators in the U.S. and Canada from Q2 2023 to Q2 2024—a traditionally challenging segment.

Over the past year, the number of IND (2-5 unit) operators using Toast jumped from 1,865 to 2,519—a 34% increase. Meanwhile, SMB (6-20 unit) operators grew from 541 to 688 brands, marking a 24% increase. Together, these 3,207 brands, controlling nearly 13.5k restaurants, account for an estimated 11.25% of Toast’s overall portfolio.

Note: Restaurantology’s Toast POS insights are verified monthly, focusing on the multi-unit restaurants with valid software detections on their websites in the past 60 days. Findings are specific to the U.S. and Canada and exclude non-restaurant industries.

Toast’s growth is particularly impressive when compared to other key players in the restaurant POS space. While competitors like Square, HungerRush, Clover, and Heartland have made progress over the past year, Toast’s growth is outpacing them all.

For example, Square—ranked second behind Toast in multi-unit website detections—also saw an increase in multi-unit detections between summer 2023 and 2024. However, Toast’s growth rate in this segment has significantly outpaced Square’s. Square experienced a 16% increase in unit counts among its multi-unit customers (rising from 6,999 to 8,158), whereas Toast saw a 32% increase (from 12,770 to 16,899). It’s also worth noting that Square’s growth among mid-market and enterprise customers has plateaued, with the number of MM and ENT logos holding steady at around 50.

Growing upmarket footprint

While Toast has traditionally been popular among smaller operators, their intensified focus on mid-market and enterprise customers is particularly noteworthy. Restaurantology’s data provides a detailed look at Toast’s growing influence within the MM (21-125 unit) and ENT (126+ unit) multi-unit restaurant segments, showing a significant uptick in Toast detections among more established brands. This aligns with Toast’s long-term strategy of moving upmarket, a trend we’ve been documenting for several years.

The momentum behind this shift is substantial. As Toast continues to enhance its offerings—integrating AI-powered tools and expanding its international presence—their appeal to larger, more sophisticated operators is set to increase even further.

In February 2024, Caribou Coffee (496 units) announced their selection of Toast to support their growing coffeehouse footprint. By March 2024, Restaurantology verified this transition with a ‘first detection’ of Toast POS on their website, promptly alerting our customers to the change.

In April 2024, Toast expanded its commitment to enterprise brands with the launch of a new [Restaurant Management Suite](# Toast Expands Commitment to Enterprise Brands with Launch of Restaurant Management Suite). This suite offers enterprise brands advanced data insights, enhanced control, robust support, and seamless integrations, all designed to help them better manage their growing operations. With this offering, Toast is well-positioned to attract even more sizable concepts, adding to its roster of powerhouse customers like Papa Gino’s (73 units) & D’Angelo’s (89 units), Bar Louie (65 units), and Nothing Bundt Cakes (524 units).

New mid-market and enterprise customers where Restaurantology ‘first detected’ a direct Toast POS integration between 2023 and 2024 include:

• Angry Chickz (27 units)
• Bandana’s Bar-B-Q (27 units)
• Egg Holic (25 units)
• OTTO (26 units)
• Skrimp Shack (23 units)

Note: While these concepts may have previously engaged with Toast, this list highlights the ‘first detection’ of a Toast POS integration—whether for online ordering, gift card management, loyalty programs, catering, or more—between June 2023 and July 2024. Note that Toast may not be utilized across all locations.

 

Toast’s all-in-one advantage

A key driver of Toast’s ongoing success is their commitment to an all-in-one approach, resonating strongly with independent and multi-unit operators seeking to streamline their tech stack without overspending. This strategy has become even more compelling over the past year, as the industry grapples with rising costs and fluctuating consumer behavior.

Originally focused on point-of-sale and payment processing, Toast quickly expanded its offerings to include integrated online ordering, gift card management, loyalty programs, and reservations. In 2023, they ventured into website management—a space currently dominated by companies like BentoBox and Popmenu. Within months, the number of multi-unit concepts turning to Toast for website management surged from zero to several dozen. As of this writing, over 100 multi-unit brands using Toast Websites have been detected by Restaurantology.

Toast’s strategy of adding incremental value through purpose-built add-ons has continued to gain traction. In 2024, they introduced one of their most significant product launches: Toast Catering & Events. Designed to meet the needs of restaurants managing large catering orders and events, this feature has already seen twice the adoption rate of Toast Websites in half the time. It directly challenges existing players like ezCater and Tripleseat, as well as new competitors such as Lunchbox’s Enterprise Catering 2.1 and Olo’s Catering+.

The adoption of Toast’s Catering & Events product has been swift, with Restaurantology estimating 190 multi-unit brands using the feature as of Q2 2024.

This rapid adoption underscores the growing demand for integrated, all-in-one solutions in the restaurant industry—a trend that Toast is leveraging with impressive success. Toast’s ability to continuously introduce new, relevant services not only adds value for existing customers but also attracts new business, fueling further growth.

What does all this mean for the industry?

Toast’s growth isn’t just about increasing their customer count—it’s about deepening their influence and capabilities within the industry. Recent high-profile partnerships, such as their collaboration with Marriott International, underscore Toast’s strategic ambition to move upmarket and deepen its integration within the broader restaurant ecosystem—and potentially beyond the restaurant industry itself.

For the broader restaurant industry, Toast’s expansion signals a shift in the competitive landscape. As more operators adopt comprehensive, all-in-one solutions like those offered by Toast, the industry must adapt. For some, this means facing heightened competition, while for others, it opens up new opportunities for partnerships and integrations that can enhance their own offerings.

As the demand for integrated, end-to-end solutions grows, restaurant tech companies need to innovate and stay informed about market dynamics. Companies seeking to navigate this evolving landscape will benefit from robust market intelligence. Providers like Restaurantology offer critical insights into these trends, helping businesses anticipate changes, identify opportunities, and make informed strategic decisions.

Toast’s path forward

Toast’s trajectory suggests that the company will continue to build on its strengths while exploring new opportunities. With a solid foothold in the long-tail segment, Toast is expected to maintain its dominance among independent and small multi-unit operators. At the same time, their strategic push into mid-market and enterprise segments, coupled with the introduction of new products like Catering & Events, signals a broader ambition to serve larger and more complex operations.

As the restaurant industry evolves, Toast is likely to keep expanding its product suite, exploring new verticals beyond restaurants, and strengthening its international presence. Their ability to innovate and adapt to market demands will be crucial in sustaining growth and staying ahead of competitors. Whether through partnerships, acquisitions, or organic growth, Toast’s next steps will be closely watched by the industry.

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Explore how Restaurantology’s data can empower your business by contacting us for more detailed insights. Restaurantology provides clients with actionable insights that can inform strategic decisions—whether competing with Toast, partnering with them, or simply understanding the market’s direction.