December 2021 - 31

identify as a " 365 operator " or an
" Avanti operator. "
" Today, 365 and Avanti are separate
product lines, " Hessling noted.
" And in the future, you can expect the
same choices of products and the ability
to work on both platforms. "
Including the Avanti and LightSpeed
mergers, 365 Retail Markets has
so far made seven M&A transactions.
The others are Stockwell (Aug. 2020),
an AI platform; Company Kitchen
(Sep. 2019), another micro market
provider; ReadyTouch (Apr. 2017), a
foodservice software company; and
AirVend (Feb. 2013), which made an
interactive touchscreen that retrofits to
vending machines. 365 reportedly has
also closed on an eighth technology
asset not yet announced.
" We're going to be buying at minimum
two or three companies a year, "
Hessling revealed. " We're an inquisitive
company and that's not going
to stop. The need for self-service is
going to grow and our size allows us
to apply different technologies to a
bigger set of customers. "
For several years, Avanti and 365 had
been " dancing gently around " what a
merger of the two would look like. It
made perfect sense when looking at
their overlapping efforts. For instance,
the companies' combined R&D spend
was basically doubled to accomplish
the same results. " We looked at this
and always thought it made sense, but
the timing was never correct, whether
it was for business or personal reasons, "
Hessling told VMW.
" 365 was always ready, but we
needed things to line up on Jim's
end, " he added. " People might jump
to conclusions that the COVID-19
crisis brought about the merger, but
it had nothing to do with it as both
businesses remained relatively strong
throughout the pandemic. "
The biggest change COVID brought out was not in the
convenience services industry. It was in every other
industry that realized unattended and selfservice
is what they need to help recover
and grow their businesses. "
Joe Hessling, 365 Retail Markets founder and CEO
That statement may sound flawed
when you think about the devasting
blow COVID delivered to most operators
throughout 2020. " In the context
of COVID, ask anybody about a business
that provides services primarily
to offices and their reaction is going
to be, 'My God that must've been horrible.'
But the reality was that people
still needed food, snack and beverage
services and we were able to manage
that demand. "
The 365 chief executive underscored
that good timing carried the
merger over the finish line. " When the
timing was right, we knew it would be
a great combination, " Hessling said.
" We kept on pestering Jim, and 365's
investors and private-equity groups
got to know him. We realized that over
time, as separate entities, we were not
going to be damaging to each other,
but coming together was a better fit. "
The micro market company's principal
investors are Providence Equity
Partners, a Rhode Island-based private
equity firm, and Omaha, NE-based
McCarthy Capital. Providence made
a majority investment in 365 Retail
Markets at the beginning of the year.
A veteran vending operator, Brinton
and two partners founded Avanti
Markets in 2009, one year after 365
Retail Markets opened for business.
Two years later, Brinton purchased a
majority interest from partners Kevin
Bailey and Aaron Speagle, who started
up another self-checkout product
geared toward foodservice management
companies. Brinton's vending,
markets and office coffee operation,
renamed Evergreen Refreshments
in 2020, was founded in 1976. It has
offices in Seattle and OIympia, WA,
and Portland, OR.
For Hessling, taking the merger
path was an easy decision. The challenge
will be the integration of 365
and Avanti.
Both 365 Retail Markets and Avanti
Markets are privately held and, thus,
the value of their merger transaction
was not disclosed. The merger result,
however, has created an enterprise
with a market share of more than 50%
in self-checkout technology in the
vending space, which mostly serves
business and industry venues. The
combined companies employ 400
people and are expected to generate
$200 million in sales this year.
Hessling pointed out that unattended
retail in the vending space
accounts for a small fraction of
self-service applications when it's
added to the same pie with all other
markets. " We tend to think of micro
markets as being in the vending
space, but once we dig deeper, we
find all kinds of what could be
considered 'micro markets.' There
are micro markets in hospitality, like
hotels, and in airports and transportation
depots ... there are micro
December 2021 * 31

December 2021

Table of Contents for the Digital Edition of December 2021

Editor's Note
Industry News
A True Story
The 2021 Pros to Know Awards
They'll Take it to Go!
Two is Better Than One
K&R Market Fresh
Social Hubs
December 2021 - PCOV1
December 2021 - PCOV2
December 2021 - 1
December 2021 - 2
December 2021 - 3
December 2021 - 4
December 2021 - 5
December 2021 - Editor's Note
December 2021 - 7
December 2021 - Industry News
December 2021 - 9
December 2021 - A True Story
December 2021 - 11
December 2021 - The 2021 Pros to Know Awards
December 2021 - 13
December 2021 - 14
December 2021 - 15
December 2021 - 16
December 2021 - 17
December 2021 - 18
December 2021 - 19
December 2021 - 20
December 2021 - 21
December 2021 - 22
December 2021 - 23
December 2021 - They'll Take it to Go!
December 2021 - 25
December 2021 - 26
December 2021 - 27
December 2021 - 28
December 2021 - 29
December 2021 - Two is Better Than One
December 2021 - 31
December 2021 - 32
December 2021 - 33
December 2021 - 34
December 2021 - 35
December 2021 - K&R Market Fresh
December 2021 - 37
December 2021 - 38
December 2021 - 39
December 2021 - 40
December 2021 - Classifieds
December 2021 - Social Hubs
December 2021 - 43
December 2021 - 44