How a failed bartending robot became a pandemic payment success
Three engineers fresh out of the Navy walked into a bar several years ago and while waiting to order, they sketched the design for a bartending robot they tried to sell to restaurants.
“Our first idea came out of the fact that we were trying to order drinks and we’re a bunch of impatient, neurotic geeks, which led us to create a robot that delivered drinks and sushi from the ceiling. But it was ahead of its time,” Steve Simoni, Bbot’s CEO and one of the three co-founders of Bbot.
In 2017 the trio adapted the technology into a touchless restaurant order-and-pay system that’s seen exponential demand during the pandemic, as dining establishments race to replace paper menus and card payment devices with contactless alternatives.
Targeting mostly independently owned casual dining operations and bars, Bbot’s software platform integrates with restaurants’ existing systems, enabling customers to order and pay via QR codes with their smartphones, a phenomenon that’s sweeping restaurants nationwide.
To meet demand, the New York-based firm recently hired Derek Domino, a founding executive at restaurant fintech Toast, as Bbot’s new vice president of sales; and promoted Matt Quinn, another former Toast employee, to manage strategic accounts.
The moves come as Bbot recently closed a round of venture capital funding, bringing its total to around $7 million. “We’re edging toward profitability, but we got what we needed,” Simoni said.
It was connections — more than cash — that Bbot needed most from Silicon Valley, he said.
“We did most of the work of developing Bbot in our CTO Luke’s apartment, but one thing venture capital really helps with is recruiting, finding people who know an industry like restaurants, and getting help structuring partnership deals,” Simoni said.
Bbot implements its solution with restaurants through a set of APIs, and works with partners to add loyalty and marketing features. Its revenue comes primarily through receiving a slight share of customers’ credit card processing volume, Simoni said.
“It’s a pay-as-you-go model, which works well because restaurants typically don’t want to commit to paying a big recurring software fee if they don’t know how it will work out,” he said.
Bbot has reached $3 million in revenue with no advertising, and it’s investing in marketing now with its recent sales department hires.
“We had cartoonish levels of growth from March through October, but I don’t think that very high level of growth can be sustained without taking some action,” Simoni said.
Bbot still sees a huge opportunity for growth in the U.S., because while the vast majority of independently owned restaurants still lack a contactless ordering system, it’s a process that’s expected to become standard post-pandemic.
From the first bar Bbot enabled with contactless ordering and payments in May of 2018, the Brooklyn (N.Y.) Barge, Bbot has signed up hundreds of large outdoor bar-restaurants in New York, Miami and Los Angeles, where customers typically roam around, and use Bbot’s app to order from anywhere in the restaurant.
Bbot recently signed its first European customer in Denmark, and the company has plans to expand in other markets next year.
The three founders’ backgrounds as Navy officers developing submarine control systems pervades their management and training style, including when working with newly signed restaurant customers.
“We bring a rather rigid, militaristic style of training to onboarding restaurants, and they seem to really appreciate our style. We take restaurants through an intense process of transforming their business, so the staff picks it up quickly and accurately,” Simoni said.
The 41-employee company has worked fully remotely from its launch before the pandemic, anticipating another trend that has become standard for many tech companies.
“We work with a lot of software programs and we’re very disciplined about how we communicate, so people aren’t getting interrupted constantly by internal messaging. We collaborate as needed and have core working hours where we minimize the amount of chatter,” Simoni said.
Bbot is also exploring other vertical industries where its technology could help speed ordering and service, but it’s abandoned plans for developing robots.