Previously bootstrapped, Lavu has been profitable since its second month in operation, according to founder Andy Lim. The company charges a licensing fee (around $1k per POS terminal) and a recurring monthly fee determined by the size of the restaurant.
Lim says that Lavu is currently being used by over 4,000 restaurants in 86 countries. Australia, Thailand, and Singapore are a few regions with especially high adoption.
The $15 million will be used to ramp up sales and marketing efforts.
“That’s what we lack; we don’t really do quite well in terms of sales and marketing… the investment is really to get those resources and connections to reach out to more of the big chains,” Lim says.
By partnering with an international fast food chain, for example, Lavu would be able to scale its platform globally at a rapid pace. Lim tells me his goal is to grow by 1,000 percent in the next 18 months.
“If you look at legacy POS systems, it’s ridiculous — restaurants are paying tens of thousands of dollars up front, if not more. They’re paying for all the upgrades, and they’re paying thousands of dollars in monthly fees,” says Lim, referring to industry incumbents such as Micros and Aloha.
Lavu is not the first venture-backed startup to tackle this problem. Revel Systems raised $100 million in 2014 for its iPad-based POS software, but it primarily serves the U.S. market.
And unlike Square, another POS option for restaurant owners, Lavu does not collect service provider transaction fees. At 2 percent on average, this adds up quickly for a business that brings in tens of thousands in transactions per month.
With the new funding, Lavu will join a small group of 30 venture-backed startups in Albuquerque, according to CrunchBase. The $15 million represents the sixth-largest venture round for an Albuquerque-based startup, and by far the largest Series A round for a company out of New Mexico.