After completing its pilot—which saw over 2,500 tables booked through its platform—and raising its first round of financing, Tablz is ready to cater to restaurants across North America.
Tablz has closed $3.2 million CAD ($2.5 million USD) in pre-seed funding from hospitality-focused New York investors to bring a new revenue stream to the restaurant industry.
“Restaurants are actually the last industry in the world to figure out revenue management.”
– Frazer Nagy
Unlike other restaurant reservation apps and table management systems like San Francisco-based OpenTable, Ottawa-founded Tablz wants to give diners the opportunity to pay an extra fee to book specific tables—enabling restaurants to monetize sought-after table space.
According to Tablz co-founder and CEO Frazer Nagy, the Ottawa-founded tech startup is far from the first company to think about premium seating, which has become commonplace in other industries, like air travel.
“That’s a big part of our pitch,” Nagy told BetaKit in an interview. “Restaurants are actually the last industry in the world to figure out revenue management, which is a combination of premium seating and dynamic pricing.”
Founded in 2021 by Nagy, COO Stef Scrivens, CPO Andrej Sakic, and CTO Jérôme St-Hilaire, Nagy claims Tablz is the only premium seating solution on the market for restaurants. Using 3D seating technology, Tablz is an opt-in service that allows diners to pay between $5 and $100 to choose the exact table they will sit at when they make a restaurant reservation. Tablz uses variable pricing based on time and day; tables booked using its platform are more expensive during peak days and hours, and cheaper during slower periods.
Tablz’ pre-seed round, which closed in May and was raised via SAFE, saw support from New York’s RiverPark Ventures, Another Round VC, New York-based In Good Company Hospitality and Branded Strategic Hospitality, BentoBox CEO Krystle Mobayeni, and Steve Simoni (former BBot CEO and current senior director of product management at DoorDash).
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It has been a tough couple of years for the restaurant industry, beginning with the COVID-19-induced shut down of in-person dining. Today, the industry faces further headwinds of a looming recession and rising inflation.
“Restaurant economics have always been broken, COVID has pushed it to the brink,” said Nagy. “And now with inflation, who knows?”
This environment has led players like Toronto-based food ordering and mobile pickup app Ritual and restaurant repair and maintenance software provider ResQ to lay off staff in an effort to reduce costs. But Nagy says Tablz isn’t worried “at all” about current market conditions, describing them as a “great time to build” for an early-stage startup.
Given that Tablz offers a new revenue stream for restaurants, Nagy also believes the company is in a good position to help during a time of need.
Tablz is Nagy’s second startup in the food and restaurant space. In 2016, he launched Transparent Kitchen alongside Scrivens and St-Hilaire, an interactive online platform that allowed patrons to browse local restaurant menus and learn where ingredients came from.
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But Transparent Kitchen closed up shop when COVID-19 hit. “We just weren’t in a position to be a COVID winner,” said Nagy. Fortunately, Transparent Kitchen was able to sell a portion of its business—namely, its platform and menu code—to an undisclosed payments company in 2020.
The team behind Transparent Kitchen used the proceeds from this deal to launch Tablz, financing the development of its platform and early operations. Nagy described Tablz as “essentially a phoenix born from the ashes of Transparent Kitchen.”
According to Nagy, by applying a flat pricing model in “one of the most dynamic industries in the world,” restaurants are leaving money on the table.
“No wonder it’s tough to be a restaurant when at 7 pm on a Saturday you have a two-month waitlist. You’re giving that booth that everyone wants away for free, the same way that you’re giving away the bathroom table Monday at 5 pm when there’s no one in the restaurant,” said Nagy.
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Tablz aims to change that and provide restaurants with a new revenue stream, giving restaurants 70 percent of fees paid to book specific tables. “This isn’t Uber Eats taking 30 percent of revenue, this is all net-new money,” said Nagy.
“When we upsell a table for you, just like booking first class on an airplane or getting courtside tickets, it’s straight gravy for an industry that honestly will lose money this year based on the inflation numbers,” Nagy.
When asked how he plans to keep Tablz from turning restaurant dining into an experience that prices out some groups of people altogether, like first-class or courtside tickets, Nagy emphasized that the Tablz’ service is “100 percent voluntary opt-in,” adding that no one has to pay if they don’t want to.
“When we upsell a table for you … it’s straight gravy for an industry that honestly will lose money this year.”
“I don’t get angry at Air Canada for having first-class and comfort-plus, nor do I get angry at the Raptors for having courtside seats or Enterprise for offering me a BMW over a Honda,” said Nagy. “I know these upgrades exist and I personalize my selection based on my budget and preferences.”
According to Nagy, Tablz’ solution isn’t for every restaurant or diner. “Will someone ever pay $5 to sit at a Denny’s?” said Nagy. “I don’t think so.”
“We care about 20 percent of the good tables—we’re really building [Tablz] for the 20 percent of people that really care where they sit,” he added, pointing out that people with disabilities or children have unique seating needs, as do diners depending on the occasion they’re celebrating, from birthdays to dates.
Tablz currently serves a range of restaurants, from fine dining establishments to sports bars and scratch kitchens, across cities like Toronto, Chicago, New York, Miami, and soon, Dubai.
Nagy said Tablz is already working with hospitality groups that own a variety of different restaurant concepts, from clubs to pizzerias, adding that the startup is also in talks with some of its first major chains. By the end of 2022, the CEO claims that “100 marquee properties” will be using Tablz.
Feature image of CEO Frazer Nagy, courtesy Tablz.