Startup pitch: Dash brings split payments to the table

Dash is the latest startup attempting to address one of the most significant pain-points in the food service side of the hospitality business: split payments for larger groups.

This is not only a pain for consumers, but also for businesses that must risk angering guests by not allowing many split payments given the exponential time cost for servers to process multiple cards.

The team consists of four full time employees: Jeff McGregor (CEO), Gennady Spirin (COO), Robin Chou (iOS Engineer), and Stephanie Bono (Account Executive). The remaining ten employees are part-time.

Investors include the CEO of New York’s the ONE Group, Jonathan Segal, who told Tnooz the following regarding the investment:

Having been approached by a number of companies with mobile payment options, we were very interested in Dash, given that it checked a number of important boxes, i.e. ease of use, functionality and serving as a meaningful application.  In our view, these are the three most important boxes to check when considering any Internet or electronic investment.

Another investor is James Holmes of Caerus Ventures:

What initially attracted me to looking at Dash was the concept; I believe whole-heartedly that mobile-based POS integration will be the way that all tabs are paid in the coming years.  What compelled me to invest was the exceptional management team and their ability to apply critical thinking to solve the pain points for both the venue and consumer, coupled with the ability to execute on a high level.

Holmes makes another valid point in relation to the role of technology in inherently social hospitality venues:

By providing a social and personalized layer through our application and the upcoming launch of the merchant application, we can provide merchants with pertinent and relevant data to help improve the interaction; be it somebody’s favorite cocktail, or letting them know that today is their birthday. Pushing relevant deals to your existing customer base fills seats when there is capacity and provides value to the consumer.

It needs to be a fine balance of preserving the human experience and building upon that with technology that makes that experience better, not coldly automating what is fundamentally a core human interaction: eating, drinking and socializing.

Read on for the Tnooz Q&A about Dash.

Tell us how you founded the company, why and what made you decide to jump in and create the business.

Dash was built out of a personal pain-point shared by both co-founders. The idea was conceptualized on New Years Day 2011 while struggling to pay the check at brunch after a long night out. Having complete lack of control over paying a tab at restaurants and bars is frustrating, so Dash set out to solve this problem and make paying the bill as effortless as possible.

What are your funding arrangements?

Dash closed a 700k Seed investment in July 2013 led by New York Angels with participation from Caerus Ventures, Brooklyn Incubator, Jonathan Segal (CEO of The ONE Group) and a multitude of strategic angel investors.

 What is your estimation of market size?

Restaurants and bars located in key US markets amount to over 250k. Dash has an addressable market of roughly 40% of the total market size.

Please describe your competition.

Dash considers point-of-sale integrated payment solutions in the hospitality industry competition. TabbedOut based in Austin, Texas and MyCheck based in Israel are both aiming to solve the payment problem in restaurants.

Dash differentiates from these by providing an experience that is far more seamless for both patrons and servers. Dash makes it incredibly easy for wait staff to link a Dash user to their table or bar tab at any point in their meal, and allows them to see real-time patron data right at the point-of-sale system. This includes data such as favorite food, drink and how often they visit the establishment.

What is your revenue model and strategy for profitability?

Dash charges a success-based subscription fee for the merchant to use the service. The App is free for patrons to download and use.

What problem does the business solve?

By improving the efficiency of the payment process, restaurants can turn more tables, and bars can serve more drinks. The unique data that Dash collects can be used to improve service and increase loyalty amongst patrons.

How did the initial idea evolve and were there changes/any pivots along the way in the early stages?

The core concept and value proposition has remained the same – allow patrons to pay for their tab whenever they’re ready to leave. The product has constantly evolved based on direct feedback from operators, wait staff, and patrons. The result has been a product that is incredibly easy that people love to use every time they go out.

Why should people or companies use the business?

If you’re a patron and you’re frustrated by splitting bills with friends and waiting around to close your bar tab or you’re known for leaving credit cards behind at the end of the night, you will find immediate value in using Dash. If you’re a merchant looking to improve the efficiency of your business and drive loyalty amongst your patrons, Dash is the answer.

What is the strategy for raising awareness and the customer/user acquisition (apart from PR)?

Due to the social nature of dining, Dash is focused on network effect opportunities through bill splitting and social features within the application where friends can all benefit from using Dash together. Our sales team is targeting the best venues in New York City to participate in the program in order to drive adoption amongst restaurateurs.

Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?

In three years, Dash aims to partner with leading restaurants in key markets across the entire country. Dash is strategically turning on subsequent markets based upon demand in particular cities. Dash will continue to focus on our core value – efficiency of payments and driving loyalty.

What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?

Innovation in the hospitality industry can be challenging due to the multitude of distribution challenges selling to SMB customers. Startups with products that create value for small business with a team capable of driving adoption are key to helping these businesses realize the opportunities new technology affords. Dash is a product where everyone wins by solving an issue both sides of the table experience.

What other technology company would you consider yourselves most closely aligned to in terms of culture and style… and why?

Dash has always taken a strong stance on not framing our product, or technology on other companies. For example… the Uber for XYZ.

This translates directly to the culture of our company. We’re all about creating our own traditions and building our culture from scratch.

A big piece of that is getting the right people involved early on to set the mood for the long run. One thing is for sure… we love to go out to eat and drink. If we can’t make it out of the office, that’s OK, because our office has a bar in it that accepts Dash payments.

Tnooz view:

It’s very possible that mobile payments could end up being a winner-takes-all situation – whoever gets the most scale in the most establishments wins. Or there could be multiple mobile payment systems that must each be integrated with the POS and workflow of hospitality staff.

The issue here is pushback from already-burdened owners – if they have to train staff on yet another mobile payment option that has its own interface and quirks, they are likely to be reluctant to make that investment. Of course, if that mobile payment type has a lot of customers, the argument is much easier to make – thus, a chicken-and-the-egg situation.

It’s going to have to take a leap of faith on a large number of venues to integrate multiple mobile payment systems and see a) which one they like best, and b) which one their guests like best. Hopefully, there will be a match, but there’s likely to be a mess of mobile payment systems vying for attention over the next few years.

Dash has a solid interface and seems to be thinking about making it as seamless as possible – a smart move because those mobile payment apps that require little-to-no systems and workflow integration are far more likely to win. “Frictionless integration” are the keywords here, and all startups playing in the POS add-on space must address this head-on.

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Nick Vivion

About the Writer :: Nick Vivion

Nick is the Editorial Director for tnooz. Prior to this role, Nick has multi-hyphenated his way through a variety of passions: restaurateur, photographer, filmmaker, corporate communicator, Lyft driver, Airbnb host, journalist, and event organizer.

 

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