Tablz closes CAD$3.2 million to offer premium seating to the restaurant industry

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Tablz wants to monetize restaurant tables like airplane seats.

After completing its pilot project – which saw over 2,500 tables booked through its platform – and the first round of funding tablz is ready to supply restaurants across North America.

Tablz has closed a CA$3.2 million (US$2.5 million) pre-seed financing 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 that knows about revenue management.”
– Frazer Nagy

Unlike other restaurant reservation apps and table management systems like San Francisco-based OpenTable, Ottawa-based Tablz aims to give diners the ability to pay an additional fee to reserve specific tables, enabling restaurants to reserve coveted table seats monetize.

According to Frazer Nagy, co-founder and CEO of Tablz, the Ottawa-based tech startup is far from the first to consider premium seating, which has become commonplace in other industries like aviation.

“That’s a big part of our pitch,” Nagy BetaKit said in an interview. “Restaurants are actually the last industry in the world to evolve revenue management that 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 in the restaurant market. Tablz is an opt-in service that uses 3D seating technology and allows diners to pay anywhere from $5 to $100 to select the exact table they will be seated at when making a restaurant reservation. Tablz uses variable prices based on time and day; Tables booked through its platform are more expensive on peak days and times and cheaper on slower times.

The Tablz pre-seed round, which closed in May and was raised through SAFE, saw support from New York-based RiverPark Ventures, Another Round VC, New York-based In Good Company Hospitality and Branded Strategic Hospitality, BentoBox CEO Krystle Mobayeni and Steve Simoni (former CEO of BBot and current Senior Director of Product Management at DoorDash).

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It’s been a rough few years for the restaurant industry, beginning with the COVID-19-induced shutdown of in-person dining. Today, the industry faces further headwinds from a looming recession and rising inflation.

“The restaurant economy has always been broken, COVID has marginalized it,” Nagy said. “And now with inflation, who knows?”

This environment has spawned players like Toronto-based food ordering and mobile pickup app Ritual and restaurant repair and maintenance software provider ResQ Lay off employees to save costs. But Nagy says Tablz is “not at all worried” about current market conditions, describing it as a “great time to build” for an early-stage startup.

With Tablz providing a new revenue stream for restaurants, Nagy also believes the company is in a good position to help in times of need.

Tablz is Nagy’s second startup in the food and restaurant space. In 2016 he started Transparent kitchen alongside Scrivens and St-Hilaire, an interactive online platform that allowed diners 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 able to be a COVID winner,” Nagy said. Luckily, in 2020, Transparent Kitchen was able to sell part of its business — namely its platform and menu code — to an unnamed payments company.

The team behind Transparent Kitchen used the proceeds from this transaction to launch Tablz and fund 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 adopting a flat pricing model, restaurants are leaving money on the table in “one of the most dynamic industries in the world.”

“No wonder it’s difficult to be a restaurant when you have a two-month wait list at 7pm on Saturdays. You give away that stand that everyone wants for free, just like you give away the bathroom table on Monday at 5 p.m. when nobody is in the restaurant,” Nagy said.

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Tablz wants to change that and offer restaurants a new revenue stream by giving restaurants 70 percent of the fees paid to book specific tables. “It’s not Uber Eats, which takes 30 percent of sales, it’s all net new money,” Nagy said.

“If we sell you a table, just like booking first class on an airplane or buying tickets at the side of the pitch, it’s pure gravy for an industry that will honestly lose money this year on inflation numbers,” says Nagy.

When asked how he intends to stop Tablz from making dining at a restaurant an experience that overprices some groups of people overall, such as no one has to pay if they don’t want to.

“If we sell you a table … that’s pure gravy for an industry that, quite frankly, is going to lose money this year.”
– Frazer Nagy

“I don’t get mad at Air Canada for having first class and comfort plus, nor do I get mad at the Raptors for having courtside seats, or Enterprise for offering me a BMW instead of a Honda.” said Nagy. “I know these upgrades exist, and I tailor my choices based on my budget and preferences.”

According to Nagy, Tablz’s solution is not suitable for every restaurant or diner. “Will anyone ever pay $5 to sit at Denny’s?” said Nagy. “I do not think so.”

“We take care of 20 percent of the good tables – we really build [Tablz] for the 20 percent of people who really care where they sit,” he added, noting that people with disabilities or children have individual seating needs, as do guests depending on the occasion they are celebrating, from birthdays to towards appointments.

Tablz currently serves a range of restaurants in cities like Toronto, Chicago, New York, Miami and soon Dubai, from fine dining to sports bars and scratch kitchens.

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. According to the CEO, “100 renowned properties” will use Tablz by the end of 2022.

Featured image of CEO Frazer Nagy, courtesy of Tablz.

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