If time is money, then restaurant reservation apps are changing the business of making money by saving users time. It’s a business that’s nearly 20 years old: Reservation powerhouse OpenTable launched in 1998 after its founder noticed his wife was finding “difficulty” in landing reservations by phone. Today, whether diners need help making last-minute reservations, securing hard-to-get tables, or eliminating the need to wait in line at restaurants that don’t offer reservations, startups are churning out mobile solutions to these challenges — and they’re increasingly capturing the attention of both diners and investors.
Case in point: In February, the user-generated review site Yelp acquired the Nowait app — which provides reservations for casual dining spots that generally don’t offer reservations — for a whopping $40 million. While Yelp, the crowd-sourced review site, has previously invested millions in the app, this new merger makes a statement: that diners and mobile users value their time just as much as they value good meals.
Yelp had previously partnered with OpenTable in 2009, shortly after OT went public. The relationship allowed Yelp users to search for and make restaurant reservations through OpenTable, but the arrangement ended in December of 2015, and Yelp has since pursued new opportunities. Now, with this recent acquisition, Nowait’s service will be integrated into Yelp’s interface, allowing diners to put themselves on restaurants’ waiting lists for tables without physically waiting.
Plenty of other restaurant apps on the market break down into two related categories: the ones that help diners make reservations and the ones that simplify portions of the dining process, like paying for the bill. Both groups have the end goal of time-saving in mind, though they identify different parts of the process to improve.
Here’s a breakdown of the reservation apps that have hit the market in recent years; most are still in the game, seeking investments to secure their longevity in the startup world:
Founders: Robb Myer, James Belt, Luke Panza, and Richard Colvin
Total Investment: $22.07 million
Locations: U.S. and Canada
Headquarters: Pittsburgh, PA
Nowait’s core goal is to save diners the time they would spend standing in line for restaurant tables. In 2016, the app received $8 million in capital from Yelp, which then acquired it outright for $40 million. Rather than targeting restaurants that take advance reservations, Nowait carved a spot for itself in casual dining by allowing patrons to virtually get on a waiting list (for free) and receive an alert when they can be seated.
Nowait has a ticker on its website estimating the app has saved users more than 4 billion minutes of time waiting for a table. With the Yelp integration, users will be able to see what wait times are for restaurants nearby and put their names in.
Founders: Santosh Jayaram and Pete Goettner
Total Investment: $4.6 million
Headquarters: San Francisco, CA
A spur-of-the-moment dining supporter, Table8 allowed users to get last-minute reservations at high-end restaurants — often, depending on the day or time of evening, diner would be charged a fee for this reservation (with Table8 splitting that fee with the restaurants).
While one of the earlier entrants into the reservation space, Table8 shut down its operation on February 28 of this year, calling into question if diners are willing to pay an access fee for prime tables. “We were not able to secure enough capital to continue to grow the business,” the founders wrote in an announcement. “We have enjoyed helping you find great restaurants, access tough-to-book reservations, and discover local chef events.”
Founders: Joe Marchese, Greg Hong
Total investment: $25 million
Locations: 125 cities
Headquarters: New York, NY
The once-described “concierge service” for restaurants, Reserve — now marketing itself as a restaurant technology company — launched by giving diners access to a list of “curated,” primetime tables for a flat $5 charge (regardless of the reservation’s time or the party size). Last year, it stopped charging that fee and added a more traditional instant-reservations service to the app and its website. In late 2015, the app counted several celebrities, including actor/director Jon Favreau and actor Jared Leto, among those who ponied up $15 million in a funding round.
Update: A previous version of this story reported Reserve still charges a flat booking fee; it no longer does so. An editing error also reported the app tackles payment; it no longer offers that service.
Founders: Gary Vaynerchuk, Ben Leventhal, Michael Montero
Total Investment: $15 million
Locations: 50 U.S. cities
Headquarters: New York, NY
Co-founded by Eater co-founder Ben Leventhal, Resy makes prime tables available for app users to book immediately, cutting down weeks-long planning for coveted times at desirable restaurants. Like with Table8, that access sometimes comes with a fee. But unlike Table8, Resy has some muscle behind it: In late 2016, travel booking service Airbnb invested $13 million in brand, with plans to integrate the reservations service into its own app — bringing Resy to Airbnb’s vast network of tourists and travelers.
Founders: Nick Kokonas, Brian Fitzpatrick
Total Investment: $7.5 million
Locations: 38 cities and nine countries
Headquarters: Chicago, IL
Tock, a restaurant reservation software company co-founded by Chicago restaurateur Nick Kokonas, helps restaurants manage bookings like standard reservations, private dining, and pre-paid tickets — the latter of which essentially charges diners for their reservations up front (or uses the reservation fee as a “deposit” of sorts that’s then applied to the final bill).
“Doing ticketing, along with an administrative charge, or a service charge, or whatever you need to call it in your state, is the future of all dining,” Kokonas told Eater in 2014. Tock raised $7.5 million in October 2016, and in recent weeks, Kokonas has been openly challenging OpenTable’s reservation-making supremacy — in the form of some online trolling.
Founders: Anna Polishchuk, Arsentii Farenyk, Stas Matviyenko, Pavel Tiron, and Dmitriy Nikulin
Total Investment: $3.85 million
Locations: San Francisco, New York, Chicago
Headquarters: San Francisco, CA
Allset facilitates in-restaurant dining for users, allowing them to reserve a space, order, and pay through the app, thereby eliminating wait times. (It’s marketed heavily to the office-lunch crowd, promising to simplify a dine-in lunch to the point where customers and preorder, sit down as the food arrive, and be in-and-out of the restaurant in as few as 30 minutes.) Allset is partnered with more than 350 restaurants to provide this service, and is primed for further expansion in 2017.
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