As any fan of Kitchen Nightmares may know, the restaurant business is not for the faint of heart, nor is it likely to generate fat margins. Now, a startup called PlateIQ has raised $4 million in new funding to help restaurants automate accounts payable, and nail all their other accounting work so they can focus, finally, on the food and front-of-house. Eileses Capital led the round joined by Initialized Capital, Restaurant Group, the Y Combinator Continuity Fund and the Tamares Group.
According to PlateIQ cofounders, the company’s software is already used by some of the hottest brands in fine dining including: Nobu Restaurants, the Thomas Keller Restaurant Group which operates the French Laundry, Vino Volo, Quince Restaurant and others.
The company’s mobile app lets a restaurant manager snap a photo of a paper invoice. The invoice is automatically digitized. Then, the app extracts the data from the invoice and synchs it with the restaurants’ accounting software, such as Quickbooks. The platform also enables restaurants to pay vendors via mobile, and keep track of how much their ingredients are costing them, over time. The idea is to help restaurateurs determine which items on their menus may be worth it or not, and which vendors can give them the best price for quality, co-founders Bhavuk Kaul and Ram Jayaraman explained.
PlateIQ will use its funding for hiring and expansion into new markets, geographically, they said. The startup used to face direct competition from Sourcery, which is also venture-backed. But now Sourcery has expanded beyond restaurants to work with wholesale food vendors, hospitality groups and even tech companies as a general platform for handling accounts payable and receivable.
PlateIQ thinks it specialization around restaurant management will help it amass customers in a sizable market. According to the National Restaurant Association, restaurants generate some $799 billion in sales each year, and employ 10% of the US workforce.
“We’re working with more than 1,000 restaurants across the country from white tablecloth to food trucks,” Kaul said. “We’re expanding in Europe and Canada and have done all of this without spending on marketing. What we want to do is democratize analytics in food so even if you are running a small but great operation, you can run analytics like McDonald’s to really guide your decisions around what you will and won’t spend on.”
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