Dive Brief:

• Toast CEO Chris Comparato will step down as CEO and board chairperson on Jan. 1, at which point Co-President and Chief Operating Officer Aman Narang will take the helm as CEO, the restaurant point-of-sale company said Tuesday.
• Comparato, who informed the board Friday of his departure, has been Boston-based Toast’s CEO since 2015, according to a news release. He will step down as board chairperson Jan. 1, but remain on the board, the company said in a Tuesday filing with the Securities and Exchange Commission.
• The board on Friday appointed Narang, 40, as the company’s CEO come January. Toast’s board chose Mark Hawkins, lead independent director and chairperson of the board’s audit committee, to serve as board chairperson as of Jan. 1.

Dive Insight:

The CEO transition announcement comes after Toast in June implemented a 99-cent customer-paid fee on orders placed through the company’s online ordering channels, but then reversed course a few weeks later to scrap it. Toast had said the fee was designed to fund product innovations and improvements.

During the company’s second-quarter earnings call in August, Comparato called the fee move a “mistake” and said Toast would take a more thoughtful approach to price increases after it faced customer backlash over the fee.

“We think investors could question why Comparato wants to step down, though having the current COO and co-founder as a successor in January 2024 seems like a logical and understandable transition plan,” Baird Equity Research analysts wrote in a Tuesday note to investor clients.

Narang co-founded Toast with Steve Fredette and Jonathan Grimm in 2011. He has been co-president since December 2012 and chief operating officer since June 2021, according to the company’s filing. He has had a seat on the board since January 2021, and also served on the board from 2011 to 2015, and from 2017 to 2018. 

“After a thoughtful succession planning process, the Board is confident that Aman is the leader who will continue to propel Toast forward,” Hawkins said in the release.

As CEO, Narang will “initially continue to receive his current salary of $20,000, which has represented his annual cash compensation since the Company’s initial public offering in September 2021,” the filing said. His total compensation in 2022 was $3.7 million, according to Toast’s most recent proxy filing. 

A Toast spokesperson didn’t immediately respond to questions regarding Comparato’s planned departure or Narang’s appointment.