
OpenTable Seats 3M diners per month, generates serious revenue - phil_KartMe
http://venturebeat.com/2008/06/29/opentable-seats-3m-diners-a-month-releases-mobile-version/
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softbuilder
I interviewed with OpenTable in 99/2000. I got into an argument with their
tech lead during the interview and sadly was not offered a job! hahaha

I will always remember OpenTable because apparently they had built a great
system on Java and Oracle (all very cutting edge at the time) and it worked
great. However they were switching to Microsoft's DNA platform because they
had a VC who was in bed with M$. Nice!

I liked their CEO and I'm betting that their success is almost entirely due to
leadership, not technology or lack of competition. Also, while I'm sure
there's room for competition, their kind of business is heavily tied to
relationships which they have no doubt cultivated for many years. An excellent
and well-earned high barrier to entry.

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pg
BTW, if someone wants to start a competitor, we'd be interested in funding
one.

~~~
edu
<http://news.ycombinator.com/item?id=232092>

I've been thinking of it for sometime now, but I've not submitted to YC
because I lack a cofounder... Anybody interested?

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pistoriusp
I'm interested.

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wensing
Part of the beauty, for me at least, is that 'restaurant reservations' is a
likely-to-be-overlooked problem in the Web 2.0 era. I mean, where's the social
networking component?! Can you friend other reservers?! Oh wait, you're going
to eat dinner with people? Oh.

How many more problems like this are out there? Reminds me of DHH's "Fortune
1,000,000".

~~~
pistoriusp
Facebook Feed/ Twitter:

"John made a reservation at 'The Sausage Saloon.'"

This may, or may-not, be a good idea. I suppose it depends on how an
individual feels about it.

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mattmaroon
I've long admired OpenTable. They've slipped into massive dominance of a large
and growing industry, and done so almost entirely unnoticed.

Also once in place, there's huge inertia preventing a restaurant from
switching to a competitor, even if a good enough one emerged. Truly
impressive.

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apathy
Let's see how they fare in the coming cool-down eh?

I have an OpenTable account and they are nice even if you don't regularly
reserve tables through the service -- you can get a very good idea of how
ridiculously inaccessible a 'hot' restaurant in Los Angeles is, for example.
(1 month out? 1 week out? 1 day out?)

~~~
edu
And how do you feel about they service? Do you think it can be improved?

I've been tinkering with the idea of building something similar for the
European market, with some improvements (if the reservation fails recommend
available time-frames, or other restaurants in the neighborhood or similar
restaurants...), recommendation or new restaurants (think of netflix for
restaurants), CRM features for the restaurants and made the system "open" so
anyone can integrate the service in whatever channel they use (web, SMS,
phone, the-next-big-thing...) sharing the commission.

By the way, I'm open to talk... My mail address is on my profile :)

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Erwin
I've used toptable.co.uk for that which is pretty good (most of their
restaurants are in London but I've booked places in Rome succesfully too). Key
points are good description of the restaurant, accurate sample menus, pictures
and reviews from other patrons.

I think just the website won't sell unless you get the selection volume of
toptable; but a turnkey reservation system + web front end would be helpful
because a restaurant can link to you and let you take over the reservation
instead of having someone have to answer the phones. Make it subscription
based to minimize up-front cost; heck even offer restaurants to host an
easily-created mini-site they can use as their official web page; there are
loads of places that don't have a website but maybe if all they have to upload
is a few pictures etc. you could go even further here allowing easy online
menu creation, export to pdf, cost calculation, whatnot.

toptable is good but not great because they usually don't integrate with the
restaurants' systems, so they have people sitting and calling the restaurants
to reserve, so there's lag between reservation and confirmation (and 50% of
the time in London my first/last name end up swapped or mutilated)

A local service here in DK is dinnerbooking.com which gives you the actual
dates & times something is available. I am far likely to book a table at such
a place than one where I have to phone them and hope to get through. Alas
they're a pretty slow Web 1.5 site.

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brent
> "If it books 80 percent through its restaurant partner sites, that means it
> charges 25 cents on about 2.4 million seated, and then charges $1 on the
> remaining 20 percent, or 600,000 seated, through its own site. So OpenTable
> is making $2.4 million a month...."

0.25 * 2.4 million + 1 * 0.6 million = $1.2 million /mo.

Still serious money, but off by a multiple of 2.

~~~
fallentimes
What other company's revenue can be off by a multiple of 2 and still be
profitable?

Good catch. Ridiculous company.

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dcurtis
I don't get it. The site looks like it belongs to a domain squatter.

They don't understand their market at all. My dad would be completely
confused.

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cdr
The design is not great, but based on their success I would be much more
inclined to believe _you_ don't understand their market.

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dcurtis
I think the majority of their current success is through integration into the
restaurant websites. They understand how to get to their users, I just think
they could be a lot better about giving them a good user experience.

And if they can get this much money with such a terrible customer experience,
imagine how much money they could make if they made it easier to use,
reputable-looking, and more visually appealing.

~~~
DenisM
You don't get it. They provide terrific cusotmer service - they solved the
problem I had and I am very happy about it. Yes, the web site could be better,
but the core problem is solved. SOLVED.

There is difference between having a car to go places any time and not having
one and dependig on friends or buses and their schedule. The car may rattle
and AC may be broken, but is a lot better than not having the car. And theirs
is the only car in town.

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Mystalic
I've had the opportunity to discuss OpenTable with the founder on several
occasions - The specific plan he put in place and the lessons the company have
learned are helping it spread internationally. It's got such a market grip.
It'll take serious grit to beat it in the market.

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sdurkin
Auction pricing for exclusive places would generate a ton of revenue.

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wallflower
Auction-rate pricing for reservations <http://nyc.tablexchange.com/>

PrimeTime Tables is an expensive, members-only reservation service.
<http://www.primetime-tables.com/>

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sachiinc
hi Guys...I am the founder of tablerush.com. Looking for investors or funders.
Anyone interested? Contact me at sachin@tablerush.com. We can surely look at
it.

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sachiinc
Ours surely offers more services than open table too..

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sabat
I like this company pretty well, in that its service is really convenient. And
it works.

(Disclaimer: I know some people who work there, including some at the exec
level. But I'm mainly biased because I've used it for years.)

There may be room for competition, especially since they are slow to roll out
obvious features like mobile access (DUH, guys) and social/recommendation
features. Other opportunities abound, and they're not taking advantage of
them.

Problem with competition: if you take OpenTable's approach, you're talking
about physical hardware in someone's restaurant.

OTOH -- who said you needed anything other than a PC hooked up to the net and
a webapp? Hmmmmmmmmmm.

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DenisM
These are touch-screens, and need to be durable for restaurant environment.

