Virtual brand provider Nextbite laid off multiple employees last month amid a shift in strategy, the company confirmed to Restaurant Business.
The layoffs affected "less than 10%" of its staff, a spokesperson said. Nextbite did not reveal an exact number, but in January, it said it hired more than 300 new employees last year.
"These decisions are never easy nor made lightly," said Nextbite co-founder and CEO Alex Canter in a statement. "In 2021, Nextbite more than tripled the size of our team, creating 100’s of new jobs. Last month, we responded to rapidly evolving industry changes and made adjustments to our organization to support our continued growth and mission of helping restaurants everywhere."
It was unclear what industry changes he was referring to or what strategic shift they prompted. But Canter said the company remains focused on growth.
"We’ve made changes in strategy that require an adjustment in terms of where we are investing within the organization, and are continuing to ramp up to support our continued growth," he said.
The layoffs follow a year of expansion and change at the company. In November, it changed its name from Ordermark to Nextbite, signaling a shift in focus to virtual brands from its original business of online ordering software, though it still offers that technology.
It also added a culinary director, a branding expert from Chipotle and a VP to help create more celebrity-backed brands, and appointed former Red Robin CEO Denny Marie Post as an adviser. Meanwhile, it developed eight new virtual concepts, including ones with George Lopez and Tom Colicchio.
The Denver-based company has a total of 17 delivery-only brands that restaurants can license and sell out of existing kitchens. Nextbite said it processed more than $1 billion in delivery orders for restaurants last year.
Much of its recent growth has been fueled by a $120 million investment in October 2020 led by big tech investor SoftBank.
The business is founded on the belief that consumers' habits have permanently changed to value the convenience of delivery, clearing the runway for virtual brands. Canter told RB last year he thought the next McDonald's or Chipotle could be a brand that exists only online.
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