InKind Raises $414 Million Led by Citi to Fund Independent Restaurants

Fintech platform InKind has raised over $1 billion in the past six months to invest in independent restaurants, a sector often considered too risky by traditional lenders.

InKind announced on Tuesday it secured $414 million in financing in a round led by Citi. This latest funding follows a $320 million round from Liberty Mutual Investments last month and a $450 million debt and equity round led by Magnetar six months prior.

InKind's model provides capital to restaurants without taking equity or charging interest. Instead, the company purchases dining credits from restaurants, typically at a 2-to-1 ratio. For example, a $500,000 investment results in $1 million in dining credits for the restaurant.

The company plans to use the new capital to expand its reach, having already provided over $600 million to approximately 77,000 restaurants. InKind aims to support an additional 10,000 businesses with over $1 billion in the coming year. This strategy has positioned restaurants as a viable asset class, with InKind reporting a closure rate of less than 3% among its funded establishments, significantly below the industry average.

InKind utilizes an internal AI tool, dubbed Sherlock, to vet restaurants and determine appropriate funding amounts and credit terms, generally between 12 and 48 months. Funding has ranged from $5,000 to $12.5 million. The platform also seeks to drive customer traffic by selling dining credits at a discount to consumers.