OLO Secures Additional $5M in Series B Funding
It was an exciting day for OLO last Friday, getting featured in TechCrunch again. Check out the story below.
Also, OLO is hiring!
OLO, An Online And Mobile Ordering Platform For Restaurants, Grabs $5 Million In New Funding From PayPal & Others
OLO, the New York-based online and mobile ordering platform for restaurants, has raised a $5 million Series B round of funding from PayPal and existing investors, David Frankel, RRE Ventures, and Core Capital Partners. The company had previously raised $8.75 million in outside funding. Exactly a year ago today, as it turns out, the company announced reaching the milestone of 1 million customers, and now that number is nearly 2.25 million, according to CEO Noah Glass.
“We started in June 2005, so it took us six and a half years to go from zero to a million users,” Glass says. “It’s incredible in less than 12 months we’ve gone from 1 million to 2 million, but it’s indicative that the market is really heating up and customers are excited about ordering from their mobile devices,” he explains.
That trend has PayPal excited, too. The company has been expanding its payments platform into the offline world in recent months. Also a year ago, PayPal made its first foray into in-store payments through a pilot program with Home Depot which saw its technology integrated into Home Depot’s point-of-sale systems. That program expanded in spring 2012, when PayPal added 15 more brick-and-mortar retail chains, and by the end of the year, it had signed up 23 national retailers and had gone live in some 18,000 stores across the U.S. It also established a partnership with point-of-sale hardware manufacturer NCR just this month, too.
But with PayPal’s strategic investment into OLO, it now has the capability to expand into yet another offline vertical: dining.
This includes both sit-down restaurants and quick-serve restaurants, as OLO counts both among its partners, which, combined, is now around 3,000 individual restaurants. This year, however, that number is about to explode. Glass tells us that OLO has four large quick-serve chains in various stages of closing deals with his company, each with over 5,000 locations domestically, and combined, totaling 27,000 units across the U.S.
“Our pipeline is crazy. We’re looking at a year where we could very easily multiply that [3,000] by five or 10,” he says. “With these very big chains, we have the potential of just massive scale.”
These new, larger QSR partners will have another effect on OLO’s business as well – no, not profitability; OLO hit that milestone mid-2012. Instead, the QSRs will help push OLO even further into mobile than before, and help establish it as a major player in the customer loyalty and rewards space, too. Glass explains that’s because online ordering doesn’t make sense for quick-serve chains, but mobile does.
2012 was already a big year for mobile adoption at OLO, he adds. For example, Five Guys Burgers, which has just over 1,000 stores here in the U.S., saw its OLO-powered mobile app downloaded over 625,000 times. Starbucks-owned bakery La Boulange also debuted an OLO-backed mobile app during the year. “Mobile used to be 10 percent of our total order volume,” says Glass, “and now, for hundreds of the restaurants we work with, it’s more than 50 percent of the order volume.”
On mobile, OLO’s restaurant partners will soon be able to better target customers with offers, discounts, and rewards that can be even more personalized than those from loyalty card startups which track transactions alone. Because OLO is an end-to-end ordering solution, it can know not just when, how often and what a customer buys, but it can also help identify their favorite dishes and preferred menu customizations, as well. For example, Glass explains, if a customer always adds bacon to their burger, the restaurant could set up a promotion that would tell them about the new BLT when the customer was within a five-mile radius and offer them a coupon to try it.
As for PayPal’s involvement, obviously OLO will now be adding it as a payment option that its restaurants can choose to integrate, alongside credit, debit, gift cards, and, more recently, Google Wallet. But, as noted above, PayPal’s investment speaks to more than just another partnership – it’s about changing the way customers think about its brand in the offline world.
“Since June 2005, I thought that mobile commerce was a huge and compelling idea, but for it to really gain mainstream adoption, we had to find the right application for it. It had to be an everyday use case. It had to be high frequency to really change user behavior,” says Glass. “PayPal’s thinking is about being an online-plus-mobile account…it’s become clear to me that the thinking with PayPal is incredibly aligned,” he says.
Glass couldn’t disclose the portion of the new investment that was PayPal’s, but did confirm that the investment didn’t involve any new board members. The funding will be used to expand OLO’s current team of a dozen to 20, if possible – mainly engineers.
Read the full article here.
And please email me at noah|at|olo.com if you would like to learn how OLO’s online and mobile ordering platform could help your restaurant brand increase same store sales and grow market share.
OLO is hiring!
OLO: Four More OLO Clients Go Mobile. Five Guys App Hits 500,000 Downloads
A Letter from OLO Founder & CEO, Noah Glass
Over seven years ago, I founded OLO with the vision that customers would soon be walking around with commerce-ready smartphones in their pockets and that busy restaurants would be perfect places to order and pay ahead to skip the line. Today, 55% of mobile phones in the US are smartphones and 50% of smartphone users are actively using their smartphones to both (1) search for restaurants and (2) make purchases.
OLO is leading the way with top-rated apps for mobile ordering. Our intuitive apps let customers send prepaid, just-on-time orders directly to the back of the house for production via the restaurant point-of-sale. As Five Guys’ award-winning mobile apps have now achieved 500,000 downloads, I am proud to announce that OLO has released four new mobile ordering apps for La Boulange, Boloco, Bullritos, and MOOYAH – all available as native apps for iPhone, Android, and iPad.
In August, I had the opportunity to contribute a byline to FastCasual.com in which I discuss the rise of the digital consumer and make the case for mobile ordering and mobile payment. Restaurant CEOs have come to understand that, “mobile is it.”
And while mobile ordering moves to the forefront, the past months have seen amazing innovation in mobile payment as well – see the recent Square and Starbucks partnership announcement and PayPal’s announcement with 15 national retailers. To that end, I am excited to announce that OLO is now an official platform partner of Google Wallet. Look out for many more great things to come in the months ahead!
Here are some of the places I will be over the coming weeks:
September 30-October 2 MUFSO Super Show: Where Foodservice Leaders Meet – Dallas, TX
October 10 Boston Beer Company Epcot Food and Wine 2012 - Orlando, FL
November 12-14 Restaurant Finance & Development Conference 2012 – Las Vegas, NV
I would love to hear your feedback and schedule time to discuss how your restaurant brand could grow sales with mobile ordering in 2013!
OLO.com: “Ordering Engine” for the Restaurant Industry
I feel incredibly fortunate to work with the OLO team every day to bring self-service ordering capabilities to the restaurant industry, improving the customer experience and generating incremental sales for OLO clients.
Since my last update less than six months ago, OLO has continued to thrive:
- OLO Launched Facebook Ordering in November of last year - allowing customers to order and pay securely right from Facebook without ever leaving Facebook
- OLO Received “Best Mobile Retail Apps of 2011” recognition by Mobile Commerce Daily for the Five Guys app powered by OLO and Solertium. The app has now surpassed 400,000 downloads
- OLO Zoomed Past 1 Million Users in early January, growing 10x in a 16-month period
- OLO Went International one day later, with the launch of OLO in Canada
- OLO Announced an Open Standard for POS Integration at the National Retail Federation Show in mid January. Learn about the Self-Service Order Interface (SSOI)
- OLO and Groupon Teamed Up for a new “Online Ordering Groupon” at SONIC with amazing results: 3x average order size, 6x order volume
- OLO was Featured in TechCrunch, announcing newly signed deals, staggering growth, and OLO’s newly launched partnership with GrubHub
Beyond these headlines, I was deeply honored by what Zerrick Pearson, Sr. Director of IT at Five Guys Enterprises, wrote about OLO in a recent LinkedIn recommendation:
“The services that Noah Glass and his team at OLO provide are simply the best in the industry. Astonishing flexibility and a powerful ordering engine, combined with ease of use and excellent support, has made OLO critical in helping Five Guys provide the best online ordering experience for our customers.” - Zerrick Pearson, Five Guys Enterprises
What struck me most was the term “ordering engine” and what it meant about how far OLO has come from the early days of bringing text-message ordering to market in late 2005. OLO is now truly a multi-channel ordering engine, driving phone sales, online sales, and mobile sales for an industry yearning to sell beyond the four walls. And this is just the beginning.
Q2 Upcoming Events
I will be living on the road for the coming weeks. Here are some of the places I will be:
April 22-25 | Dallas, TX
Women’s Foodservice Forum Conference in Dallas
Learn more: http://annual.womensfoodserviceforum.com/
May 2-4 | Chicago, IL
Marketing Executives Group
May 5-8 | Chicago, IL
National Restaurant Show
Learn more: http://www.restaurant.org/show/index.cfm
I hope to see you during my travels.