The multitude of restaurant reservation apps diners have to pick from is down one: Reservation platform Resy has purchased competitor Reserve for an undisclosed amount, according to a press release.
Chicago-based restaurateur Nick Kokonas — whose Tock reservation system competes with Resy and Reserve — told Eater that Resy had reached an agreement to purchase Reserve, which has been looking for a buyer since earlier this year. “We saw the deal months ago, we spent a solid week analyzing it in detail, and we absolutely couldn’t come up with a single reason why we’d want to do it,” Kokonas said.
Both Reserve COO Michael Wesner and a spokesperson for Resy initially declined to comment on the news.
At least for now, Resy will run Reserve as-is; restaurants using Reserve won’t migrate to Resy until next year, according to the New York Times.
With the acquisition of Reserve, Resy now services around 4,000 restaurants across the U.S., making it the largest privately held restaurant reservation service in the country. By acquiring Reserve, Resy becomes the most viable competitor to reservation giant OpenTable.
It also boosts Resy’s presence in Chicago, where Reserve dominated as a competitor to OpenTable. But OpenTable has not had a good year in the Midwestern city: Earlier this year, it was discovered that an OpenTable staffer made hundreds of fake reservations at Chicago restaurants in order to harm restaurants that had switched over to Reserve; the plan backfired, driving restaurateurs into Reserve’s arms.
Resy was founded in 2014 by entrepreneurs Gary Vaynerchuk and (Eater co-founder) Ben Leventhal with a business model that initially hinged on charging diners a premium to book reservations at hot, in-demand restaurants. (That “pay-to-play” model has since been phased out in favor of free-to-the-diner reservations.)
Reserve was one of the first companies launched by Expa, an incubator created by Uber co-founder Garrett Camp. Also debuting in 2014, it attempted to differentiate itself from the other reservation apps with more concierge-like service, and by giving users the option to pay their tab within the app.
Though the online reservations space is still dominated by 20-year-old OpenTable, numerous startups have burst onto the scene over the past several years to give the reigning reservation platform a run for its money. Many of those, such as Table 8, Rezbook, and Bookatable, have since ceased operations or been acquired, leaving Resy, Tock, Yelp, and Reserve as the notable players in the market.
Resy’s acquisition of Reserve, which has a significant presence in some smaller markets, like Asheville, North Carolina, and Burlington, Vermont, will bolster its mission to compete with OpenTable. Though some restaurateurs are being lured from OpenTable for the lower, flat-fee pricing model offered by Resy, making the switch is fraught for many in smaller markets where Resy doesn’t yet have much of a footprint. “When only 10 other restaurants [in Dallas] are on Resy, you don’t want to be the one to take the plunge and possibly lose revenue,” Dallas restaurateur Brooks Anderson recently told Eater.
Resy also recently became the exclusive reservation partner for Danny Meyer’s Union Square Hospitality Group, which includes such perennial NYC hot spots as Gramercy Tavern and Union Square Cafe — a blow, if perhaps more of a symbolic one, for OpenTable; all USHG restaurants will operate on Resy by early 2019.
Eater Chicago’s Ashok Selvam contributed reporting to this story.
Update: November 5, 2018, 10:12 a.m.: This story has been updated throughout to reflect confirmation of the merger.