Financial services startup Ghost Financial has announced an early round of investment as it rolls out banking-style products to the growing sector of "ghost kitchens", restaurants dedicated to serving customers via food-delivery apps.
Austin, Texas-based Ghost said that it had raised $2.5 million from investors including HOF Capital, 305 Ventures, Hustle Fund and Active Capital. The company provides small businesses operating ghost kitchens with insurance, loans, credit cards and other financial products.
As food delivery soared in popularity during the pandemic, many ghost kitchens sprouted up to meet the demand. They are separate from sit-down restaurants and focus solely on delivery. The young businesses often buy their inventory using cash, checks or debit cards, rather than credit, which hampers their growth, said John Meyer, chief executive of Ghost Financial.
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"What seems to be lacking is a very clear banking and financial layer to support the...ghost kitchen industry," said Meyer.
Major restaurant groups such as Wingstop Inc WING.O have also embraced ghost kitchens in recent years, spurred by the sector's lower upfront cost and labor expenses, Reuters has reported.
No Sign The Trend Is Ebbing
Though the popularity of food delivery took off during the pandemic, there is no sign the trend is ebbing, Meyer said, noting that some popular figures such as YouTube star MrBeast have begun dabbling in ghost kitchens.
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