Giftify expands with TakeOut7 acquisition to bolster restaurant tech

SCHAUMBURG, IL - Giftify, Inc. (NASDAQ: GIFT), a leader in the incentives and rewards industry with a current market capitalization of $49.28 million, has announced the acquisition of TakeOut7, a restaurant technology company. According to InvestingPro data, the company’s stock has seen a challenging year, declining over 57% in the past 12 months, though it remains undervalued based on Fair Value analysis. The all-stock deal, involving 350,000 shares of Giftify common stock, aims to enhance Giftify’s digital commerce ecosystem by adding online ordering and AI-powered marketing solutions.

TakeOut7’s technology platform is designed to support independent restaurant operators with a "zero cost" business model. It charges customers a service fee while providing a suite of services such as online ordering, kitchen integration, and delivery coordination. Additionally, TakeOut7’s Platr platform offers AI-driven digital marketing services, including website design and social media management.

The acquisition extends Giftify’s reach to over 185,000 restaurants nationwide, creating synergies with its existing Restaurant.com platform. While InvestingPro analysis shows the company operating with modest gross profit margins of ~14% and currently unprofitable, Giftify CEO Ketan Thakker expressed that the move represents a significant expansion of their technology platform and market reach within the restaurant industry.

By integrating TakeOut7’s ordering technology with Platr’s marketing solutions, Giftify aims to address the operational needs of independent restaurants and enhance the value proposition to Restaurant.com partners. The combined platforms have a track record of generating over $300 million in sales for restaurant clients and have connected more than 1,500 restaurants with over 20 million customers in the past five years.

Giftify’s acquisition targets a $1.5 billion restaurant digital marketing market, aiming to cater to approximately 200,000 independent restaurants with annual sales exceeding $1 million. The deal is expected to contribute positively to Giftify’s financial performance immediately upon integration, leveraging existing restaurant relationships to accelerate growth.

TakeOut7’s platforms generate an average revenue of $2,500 per restaurant annually, operating near break-even. With the integration, Giftify plans to expand market penetration among Restaurant.com’s network of restaurant partners.

The acquisition is based on a press release statement and reflects Giftify’s strategy to become a comprehensive technology partner for independent restaurant operators, offering solutions for customer acquisition, online ordering, and digital marketing. InvestingPro subscribers can access additional insights, including 8 more ProTips and detailed financial metrics that provide a comprehensive view of Giftify’s market position and growth potential.

In other recent news, Giftify, Inc. has restructured a $7 million debt for its subsidiary, CardCash Exchange, Inc., with Pathward, National Association. This revised financial agreement, detailed in a recent SEC filing, reduces the principal amount from a previous $10 million and ties the interest rate to the Wall Street Journal’s prime rate, plus 3%, with a minimum effective rate of 6.50%. Monthly interest payments are required, and a default could trigger an additional interest charge. This debt is secured by CardCash’s assets, and the cash collateral balance requirement has been lowered, releasing $250,000 in liquidity. Additionally, Giftify has expanded its CardCash.com platform to offer discounted gift cards for sports retailers, aiming to help fans save on game tickets and merchandise. The platform features discounts for retailers like StubHub and Fanatics, potentially reducing game-day costs by 10-20%. This initiative is part of Giftify’s strategy to engage consumers in high-frequency spending categories and promote recurring platform use.

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