I'll have that to go – Index puts £10.5m into fast food ordering

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Who needs web apps and crazy things like Twitter when you can invest in an online ordering system for fast food outlets? That’s what’s just happened to Just-Eat, possibly the leading European aggregator site for ordering fast food online. It’s closed its first institutional financing, with Index Ventures leading the large £10.5 million round. Venrex Investment Management and existing shareholders also participated. The capital will be used to consolidate the company’s position in the UK and to expand into Europe. It appears they are going up against local boostrapped startup HungryHouse. However they haven’t reach me yet and I’m online all the time. I’ve never used Just-Eat to order from my local pizza place, I just pick up the leaflets regularly shoved through my letterbox – but I guess maybe I will soon?

As the name suggests Just Eat provides a way to order takeaway food online from you neighborhood restaurant without them having to build a system themselves that can take credit or debit cards – or take orders over the phone. In these tiny businesses, it’s faster to print out an order than it is to release staff to take phone calls. With this system the restaurants can reach and market to a much wider audience online. An interesting differentiator is that they put a terminal in every restaurant that they work with so they can communicate with the restaurant directly, ensure that orders are received, know when they’re sent out, and identify any problems instantly.

Consumers get a confirmation that their order has been received and the estimated delivery time. And they can rate the places. Currently there are over 6,000 restaurants in the Just-Eat network, with close to 3,000 in the UK.

The home delivery market is growing at 9% per year and is growing in the recession as people go out less. Founded in Denmark in 2001 the service is currently available in the UK, Ireland, Denmark, Holland, Belgium and Sweden and will soon also be available in Norway.

Wouldn’t this make sense as an iPhone app maybe?

Although they are quite different businesses, Just-Eat’s cash injection has some implications for sites like Yelp and Qype in Europe because JE allows users to rate outlets as well as order – although the community aspect is pretty limited.

  • http://geetarchurchy.wordpress.com Matt Churchill

    I’d quite fancy this on Twitter too!

    • http://www.adexcel.com Darren

      This is probably just the beginning of Fast Food 2.0 . If the F&B space ever wants to innovate or be craetive on the web, then it will probably the fast food companies. They always have to the best ads and marketing ideas. Now, think McDonald 2.0 ;)

      – Darren at AdExcel dot Com

      • http://www.just-eat.co.uk David Buttress / Just-Eat.co.uk

        Hi Darren
        We obviously agree! The opportunity right now in this space is to tell people the phone is no more, long live online takeaway! This message is something we will be working hard to deliver in the years to come. Most people simply don’t know that you can order takeaway food online and our job and one of the key things we will now be doing is making sure that firstly people know they can ‘just-eat’ and secondly when they find it, it is a great way to order a takeaway!

        Just-Eat.co.uk is already a great offering but there is always room for improvement. We have over the last 3 years built a dominant market position in terms of restaurants & takeaway orders in the UK. Just-Eat has significantly more restaurants than anyone else giving consumers a real ‘choice’ in mulitple locations and we are growing 2-5 times quicker than the other ‘start ups’ in this space. That’s why we love working in the company!

        Of course the key point is that we will now in time be able to give consumers in the UK more choice, quality and be truly nationwide. That is a key thing when people try us versus the phone for the first time. Time to ‘Just-Eat’ your takeaway. ;)

  • Seyi

    this should be good news for http://www.mjam.net who currently operate in austria and germany

  • http://www.w3roi.com Dan Grossman

    In the US, I order food online at CampusFood.com almost weekly, for the past couple of years.

  • http://feedraider.com Jussi

    “Just fat”

    Fast food does that to you!

  • Judo

    Thought HungryHouse rang a bell – they got funding on Dragons Den (http://www.youtube.com/watch?v=kzcQtXA5Gc8)
    They sold 50% for GBP100k

    • Chris

      That’s right – I remember that episode. Wow! 50% for GBP100k is nuts when you compare it GBP10.5 M – I bet HungryHouse are pretty worried by this level of competition.

      • edc

        Hungryhouse never got the money in the end! not sure why

      • http://hungryhouse.co.uk Graeme (hungryhouse)

        I work at http://hungryhouse.co.uk, we’re the number 2 takeaway aggregation website here in the UK market.

        Congrats to all at Just Eat for raising the finance they’ve been looking for.

        Right now we believe the vast majority of people in the UK would only think of the big pizza chains when it comes to ordering their takeaway online. Hopefully, the money the team at Just Eat have raised will go towards increasing the public’s awareness of the new way of ordering, and end up growing the market as a whole.

        From our own experience, a few countries have had this concept around for years, but here in the UK it’s only really taken off since Just Eat and hungryhouse launched (both back in Feb 2006). £10.5m is a great and ambitious investment, really shows confidence in the potential for this to become *the* way to order. As you say Ed, the hungryhouse investment from Dragons’ Den didn’t go ahead, but we found other investors about this time last year and are pressing ahead with our own expansion.

        We’re sticking to our plans, and hopefully if we can provide a quality interface, a strong customer community, and top notch customer service, then we should keep hold of loyal customers. There’s certainly nothing to stop us from competing on our range of restaurants – if not having the $$$ to spend big on marketing!

      • http://hungryhouse.co.uk Graeme (hungryhouse)

        I work at http://hungryhouse.co.uk, we’re the number 2 takeaway aggregation website here in the UK market.

        Congrats to all at Just Eat for raising the finance they’ve been looking for.

        Right now we believe the vast majority of people in the UK would only think of the big pizza chains when it comes to ordering their takeaway online. Hopefully, the money the team at Just Eat have raised will go towards increasing the public’s awareness of the new way of ordering, and end up growing the market as a whole.

        From our own experience, a few countries have had this concept around for years, but here in the UK it’s only really taken off since Just Eat and hungryhouse launched (both back in Feb 2006). £10.5m is a great and ambitious investment, really shows confidence in the potential for this to become *the* way to order. As you say Ed, the hungryhouse investment from Dragons’ Den didn’t go ahead, but we found other investors about this time last year and are pressing ahead with our own expansion.

        We’re sticking to our plans, and hopefully if we can provide a quality interface, a strong customer community, and top notch customer service, then we should keep hold of loyal customers. There’s certainly nothing to stop us from competing on our range of restaurants – if not having the $$$ to go big on marketing!

      • joe

        Hungry house never got the money due to very poor inexperienced mangers and due to there site been very very poor. I do not know why they keep getting mentioned as competition. There are lots of better operators out there

    • joe

      I would not use hungry house even if my life depended on it. It is by far the worst site i have ever seen.

      • Ryan

        I actually find Hungry House better and more fun to use than just-eat.

  • http://blogs.sun.com/startups Stewart Townsend

    I tend to use Just-Eat when travelling to find somewhere local to deliver food to me, always found it a great service from that aspect I wouldnt use for local where I live service, like yourself Mike the old tried and tested, leaflet through the door held in the top draw works for me.

  • http://www.tisme.com.au Mathew Carpenter

    I have never heard of Just-Eat before, but it’s an awesome idea and I can see why Index invested so much into the company. I’m a bit dissapointed though, as there is nothing like that here in Australia and I doubt there will be anytime soon due to the fact we are so far behind.

    • Chris

      It doesn’t sound like a very difficult project to build – I imagine that marketing would be the tough bit. I’m an Aussie too – I’d welcome a service like this here in Australia. I just don’t know that starting a company like this in the middle of a recession would be such a great idea though – I would suspect that home delivered food is one of the first businesses to feel the pinch?

      • Harry

        On the contrary… takeaway/fast food performs brilliantly in a recession. It is seen as an affordable luxury, it is traditional sit down restaurants that suffer. Look at Domino’s Pizza which has traded up 17% over the last year.

      • Martin

        I never found Domino’s to be that cheap at least in the UK, I find it cheaper getting a take away at a real Italian pizza restaurant with a much higher quality product.

  • http://www.yourtour.com Bachir Salamat

    i wonder what is their business model?

  • dougal

    What was the equity taken for the £10.5m

  • http://www.davidbuttress.com/a-great-day-for-just-eat-we-have-vc-lift-off/ A Great Day for Just-Eat – We have VC Lift Off! | David Buttress - Inch by inch...

    […] uk.techcrunch.com/2009/07/14/ill-have-that-to-go-index-puts-105m-into-fast-food-ordering/ […]

  • http://leebandoni.com Lee Bandoni

    I am a Internet marketer and fast food retailer so I have been following the just eat business for a long time.

    What makes the Just Eat product so good is the way they deliver the order to the retailer using a simple mobile “order terminal” with a few buttons and a receipt printer. In my opinion this is the second best way to deliver the order but is definitely the best on the market right now.

    There are a number clone sites in the UK but they all seem to be playing catch up and require either a fax, pc or call peoperator be located in each store.

    If Just eat is reading this PLEASE come and fix my terminal as I give you all this praise but you dont answer my email lol.

    P.S I heard on the grapevine that an Iphone app is iniment

    • http://Just-Eat.co.uk David Buttress

      Hi Lee, feel free to write to me directly. My mail is on the main .co.uk site! Thanks for all the commments. It is a busy day in online takeaway land! :-) David Buttress / Just-Eat.co.uk

  • http://ichoosr.com bart Stevens

    congrats for the team!

  • http://www.articleplayground.com Article Playground

    That’s alot of money to be invested into an online food chain :)

    • Alex

      The site reads “22757 orders within the last 24 hours”. That’s $1,137,850 a day at $50 average order. If they charge 10% it’s $113,785 profit per day. The $10M investment is returned in 87 days :-)

      • chris

        That’s a pretty big assumption. I very much doubt they’d be making that sort of money – if they were then why bother taking the investment – just wait 87 days and you’re there!

        I would think that the profit on this business would be a lot lower than you think.

      • http://www.geekevaluation.com geekevaluation

        +1

      • Alex

        That was an outrageous estimate so that you guys could start thinking ;)

        Of course it will be lower. There are huge expenses as well, so it’s not all profit. The amount I stated was actually a revenue.

        But even with this blatant estimate, you could see the potential and why 10.5M was invested.

  • http://lemming.name lemming

    Is this logo serious? I first read “just fat”.

  • Jonathan

    “The home delivery market is growing at 9% per year and is growing in the recession as people go out less.”

    So let me get this right…it is cheaper to get food delivered than to drive to the restaurant and eat it there….? That’s very different from where I live.

  • http://www.appgiveaway.com Al

    You see their logo printed in many kebab shops up and down the UK.

    I have never used the system but it is a good idea as you can read reviews and proceed to order.

  • Oleg Abdrashitov

    There’s a similar service in Russia: http://foodik.ru, growing rapidly. Another one in Turkey: http://www.yemeksepeti.com/
    Both extremely popular.

  • http://www.aroxo.com Matt

    Just-Eat is a big business doing thousands of meals a day in the UK, by far the dominant provider.

    They’ve got some brilliant hardware which sits in the restaurants kitchen and prints orders out. The purchaser, knows that their order has been delivered because the restaurant has to actively accept the order.

    This way as the person ordering there’s no worry that you’re order has gone into an email inbox which no-one monitors…

  • samd

    I think the just eat stats on their site are garbage and the interface sucks BUT there is a market for this and a space for someone to blow them out of the water

  • Basar Kizildere

    Just-eat is just-not that interesting.

    http://www.yemeksepeti.com (translation: foodbasket.com) in Turkey has been operating since 2000 and here are the latest stats:

    570,000+ registered users
    3,300+ registered restaurants
    9,000,000+ orders since launch
    335,000+ menu items

    Seems like the only thing Just-eat is doing better than YemekSepeti is the number of restaurants, but considering that Yemeksepeti.com is concentrating in one country only, that’s quite normal.

    Just wanted to let you know :)

  • Basar Kizildere

    Just-eat is just-not that interesting. Their stats smell bullshit. 24,000 orders in 24 hours? Yeah right…

    On the other hand, http://www.yemeksepeti.com (translation: foodbasket.com) in Turkey has been operating since 2000 and here are the latest stats:

    570,000+ registered users
    3,300+ registered restaurants
    9,000,000+ orders since launch
    335,000+ menu items

    Seems like the only thing Just-eat is doing better than YemekSepeti is the number of restaurants, but considering that Yemeksepeti.com is concentrating in one country only, that’s quite normal.

    Just wanted to let you know :)

  • Jessie Anderson

    Mike,

    You’re such a startup snob sometimes. Unless it has the words realtime, open, social or iphone in it you turn your nose up.

    Although your reporting is positive it reads with such overtones of snobery and negativeness!

    Then to top it off you throw in some comment about an iphone app. Who gives a t*ss about an iphone app i’m sure 98% of people in blighty can be reached with a plain old website with out any realtime mobile iphone TC bullcrap.

    Jessie

  • http://www.facebook.com/people/Danvers_Baillieu/727182253 Danvers Baillieu

    By co-incidence, I signed up and used Just-Eat for the first time last weekend, as I was trying to find a new Chinese delivery service (my wife tends to bin the menus that get pushed through the door). I have to say that I was pleasantly surprised with how smoothly the website worked and that it allowed me to pay on delivery (being skeptical of giving my cc details to an intermediary website, in case the order didn’t get put through).

    Given that quite a few takeaway/delivery services have poor websites, and ordering over the phone can be painful, I really like the service offered by Just-Eat.

    BTW – another web 2.0 aspect of the site is that you can save your “favourite” menus. And the search function worked v well.

    And £10.5m in funding – puts them right up there as a serious UK web start up….

    PS – and my food arrived within 30 minutes on a Friday night!

  • http://www.118menu.co.uk mark

    Don’t forget about 118menu.co.uk another strong UK competitor

  • samd

    true why build just for the iphone why not just build a m.xxx.com interface that any phone with a decent browser can use..

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