By Alistair Barr
SAN FRANCISCO, Feb 12 (Reuters) – Seamless will generate
more than $100 million in revenue this year as the online food
ordering service expands in new cities and benefits from a surge
in mobile users, Chief Executive Jonathan Zabusky said on
Tuesday.
Seamless generated $85 million in revenue last year as its
consumer business, its largest, grew 60 percent.
“That puts us squarely in the lead in this category, at
twice the size of our nearest competitor,” Zabusky said in an
interview on the sidelines at the Goldman Sachs Technology and
Internet Conference here.
Zabusky is scheduled to speak at the conference on
Wednesday.
GrubHub, Seamless’s main rival, hired banks late last year
for a possible initial public offering in 2013. That company’s
revenue is roughly half that of Seamless, which posted about $60
million in sales in 2011. [ID: nL1E8M8I3M].
Seamless will soon be processing $1 billion worth of food
orders a year, Zabusky said. Seamless makes money by taking a
small cut of the cash from these orders. The business has a high
degree of operating leverage, which means each extra dollar of
revenue boosts profitability, Zabusky explained.
While GrubHub may be heading for an IPO, Seamless is
waiting.
“We are in a fortunate position to be profitable, with a
strong balance sheet,” Zabusky said. “We don’t need to rely on
fickle public markets to fund our growth.”
Once known as mainly a New York service, Seamless saw rapid
growth in other cities last year. The volume of transactions the
company processed in Los Angeles more than quadrupled in 2012,
while transactions in San Francisco more than tripled and more
than doubled in Washington DC, according to Zabusky.
Customers are also ordering more frequently through tablets
and smart phones, he added. More than 30 percent of order volume
now comes through Seamless’s iPad application and mobile devices
account for more than 40 percent of volume, he noted.
(Reporting By Alistair Barr; Editing by Bob Burgdorfer)
