Online food ordering platform ChowNow has closed a Series A funding round to expand its footprint in the hospitality business
A Q&A with ChowNow co-founder and CEO Christopher Webb. The Santa Monica, California–based company was founded in 2012 and raised $3 million in Series A funding in mid-January. Investors include GRP partners, Daher Capital, Double M Capital, Karlin Ventures and Velos Partners. ChowNow was a Featured Startup on StartUp Beat last year.
SUB: Who are your target markets and users?
Webb: Restaurants! Well actually the hospitality industry—but mostly restaurants. Recently we also started working with skiing resorts and grocery store market places. We work best with restaurants that are thinking about their website and social media presence. A lot of our clients come to us and already have huge fan bases and great websites. And others come to us because they want our help.
SUB: Who do you consider to be your competition?
Webb: This should be an easy question, but it’s actually a bit complicated. If you ask who do our clients and potential clients think our competition is? They’d tell you Grubhub and Seamless.
The thing is, ChowNow is actually a great compliment to either of these portal sites. Eventually though, many of our clients end up deactivating other online ordering services sheerly because ChowNow makes more sense from both an economic and branding perspective. With ChowNow, that customer that before was sent to Grubhub to place their order can now do so on a branded platform, for way less money. If you ask the ChowNow team who we think of as our competition, the fact is there really isn’t another service out there that does what we do, on the level we do it.
SUB: What differentiates ChowNow from the competition?
Webb: So this is a two-pronged answer too. In regards to ChowNow versus a portal site, the differences are clear. Portal sites are great for researching options when you have no idea what you want. ChowNow’s approach is different in that our platform consists of branded tools. These tools provide online ordering channels that make loyal customers that much more excited and attract new users looking for easy ways to order their take out.
If you compare ChowNow to other online ordering platforms, most of them provide restaurants with an online ordering website widget. ChowNow is an online ordering system, with three different complementary channels.
SUB: When was the company founded and what were the first steps you took in establishing it?
Webb: ChowNow launched into the marketplace in May 2012. Before building a product or even raising capital, we spent months doing market research. We produced flyers for a fictional product and went door to door selling this fictional product. After hearing enough restaurant owners say they’d buy it, we knew we were onto something. We then raised a tiny round of capital and built a prototype.
SUB: What was the inspiration behind the idea for ChowNow? Was there an ‘aha’ moment, or was the idea more gradual in developing?
Webb: It was more of a gradual developing. I worked on Wall St. for many years, ordering dinner through Seamless a countless number of times. Each time I would wonder why so many restaurants bought into the concept. My family also invests in a few CA-based restaurants, so I spend a lot of time with people in the restaurant industry. It all came together when I returned home to Venice and got together with old buddy Eric Jaffe.
SUB: How did you come up with the name? What is the story behind it?
Webb: We were able to buy the URL at auction. It’s really that simple. We had a few names we liked but finding a good URL these days is very difficult. It came down to web address. Luckily ‘ChowNow’ was our top choice.
SUB: What have the most significant obstacles been so far to building the company?
Webb: Scaling. We’ve thankfully grown extremely quickly, but that means we’re constantly having to evolve, grow, build protocols, add team members.
SUB: You just raised $3 million in Series A funding. What are your plans for the new funds?
Webb: The funds will be used to fuel our new product pipeline and extend our marketing and advertising efforts.
SUB: Why was this a particularly good time to raise more outside capital?
Webb: Within a few months of launching, we had restaurants in 44 states using the platform. ChowNow was, and still is, getting a lot of organic traction. The timing felt right to step on the gas pedal and expand our business/product. To do so required outside capital.
SUB: How does the company generate revenue or plan to generate revenue?
Webb: We charge a monthly fee for the platform – $89 per location.
SUB: What are your goals for ChowNow over the next year or so?
Webb: Steady, stable growth.
ChowNow – www.chownow.com