The Joe Coffee team, with co-founders in front, from left, Nick Martin, Brenden Martin and Lenny Urbanowski. (Joe Coffee Photo)

Coronavirus isn’t slowing the coffee business, at least when it comes to mobile ordering and payments, and Seattle startup Joe Coffee is seizing on demand for its services by raising $1.3 million in new funding, the company announced Thursday.

The “second seed round” was led by Craft Ventures and follows investments of $2.2 million from Gravity Payments, Flying Fish Partners and others.

The 6-year-old company’s mobile order and rewards app helps local and independent coffee retailers compete with big chains such as Starbucks.

More than 1,000 shops are now on the platform and business is booming during the pandemic and shutdowns as coffee sellers and drinkers have been forced to change in-store habits and embrace a tech-driven solution. Joe Coffee says sales have increased 20X since March.

“Mobile ordering and payment technology was growing rapidly pre-COVID-19, but now is accelerating exponentially — and we expect these behaviors to become routine,” co-founder and CEO Nick Martin said in a news release. “While the pandemic is driving rapid growth, our platform is becoming a foundational tool to help independent businesses reimagine the way they serve their customers after we return to a new normal.”

Joe Coffee says that a survey it conducted found that 80% of daily coffee drinkers report using a mobile app to order coffee during the pandemic, and two-thirds of those people expect to continue using an app beyond the health crisis.

Martin said the funding would be used to provide better marketing and account support from a larger account management team. Shops will also gain more ways to customize their digital storefronts and enhance relationships with customers. The company also plans to add more resources to its loyalty program to encourage repeat customers.

Seattle-based credit card processing and financial services company Gravity Payments invested $500,000 in Joe Coffee earlier this year with the intent that it could help the startup take on Square, the mobile payment company that caters to many shops.

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