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<br /> Online food portal <keyword id="830092" type="COMPANY" weightage="20" keywordseo="Zomato">Zomato</keyword>, which recently received an investment from <keyword id="80004" type="COMPANY" weightage="20" keywordseo="Info-Edge">Info Edge</keyword> last year, has acquired US based food portal Urban Spoon for $52 million. Info Edge made the disclosure to the National Stock Exchange (<keyword id="6354646" type="CITY" weightage="20" keywordseo="NSE">NSE</keyword>) in a letter dated January 12, 2015.<br />
	<br />
	Apart from the US, Urban Spoon has operations in Canada, UK, Ireland, Australia, Canada and New Zealand. “The transaction is an all cash transaction amounting to $52 million,” the company said in a letter.<br />
	<br />
	It should be noted that Info Edge has invested nearly Rs 1.85 billion in food guide portal Zomato Media Private Limited. “…Upon completion of the allotment/transfer of shares against the said investment aggregate amount of investment in Zomato will be about Rs 3.27 billion. Info Edge will hold 55.13% of the equity share capital of Zomato. The overall holding on a fully converted and diluted basis will remain at 50.1%,” said the company in the letter.<br />

Indian
Food Guide Portal Zomato Acquires US Based UrbanSpoon For $52 Million<b></b>

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<p><span class="KonaFilter image-container display-table float_right"><span><span data-post-image="" class="image on-image"></span><p></p></span></span>IAC-owned <a href="http://www.urbanspoon.com/">Urbanspoon</a> has been acquired by Indian startup <a href="https://www.zomato.com/">Zomato</a>, a restaurant directory service, the companies announced Monday.</p>
<p>Sources report the deal is between $50-60 million. <a href="http://www.geekwire.com/2015/restaurant-directory-zomato-buying-urbanspoon-part-u-s-expansion/">A report from GeekWire</a><span>&#xa0;published Sunday said U</span>rbanspoon CEO Keela Robison would depart <span>as part of the acquisition, but Zomato did not confirm that information</span>.</p>
<p><span><span>Zomato, which was founded in New Delhi in 2008, has expanded to provide 330,000 listings for restaurants in countries including&#xa0;</span><span>Canada, Brazil, and Ireland.&#xa0;</span></span></p>
<p><span><span>With the acquisition of Urbanspoon, Zomato will break into the US market, competing against services like Foursquare and Yelp and bringing the total number of countries served by Zomato to 22.</span></span></p>
<p><span>Unlike its competitors, Zomato's approach to getting information about restaurants is grassroots: the company hires locals to curate restaurant information, take pictures, scan menus, and create recommendations. Zomato also includes real-time information about the restaurant and lets users book tables through its iOS and Android apps.</span></p>
<p><span><span>"Zomato has experienced phenomenal growth in recent years, and our customer bases complement each other's perfectly,"&#xa0;</span><span>Urbanspoon CEO&#xa0;</span><span>Keela Robison said. "Zomato's significant investments in people and technology will bring Urbanspoon customers, restaurant owners, and food bloggers a number of new capabilities and features. We're excited to combine our strengths to accelerate growth."</span></span></p>
<p><span><span>Zomato has acquired six local restaurant search companies in New Zealand, Poland, Czech Republic, Slovakia, Italy and Turkey in the past six months, including </span><a href="http://menumania.seccionamarilla.com.mx/" target="_blank">MenuMania</a><span>&#xa0;in New Zealand and </span><a href="http://www.cibando.com/" target="_blank">Cibando</a>&#xa0;in Italy. </span></p>
<p><span>Urbanspoon, which was founded in 2006 and in 2009 was acquired by Barry Diller's IAC, is Zomato's first US acquisition.</span></p>
<p><span style="line-height: 1.5em;">"We have been planning our entry into the North American market for some time, and Urbanspoon's excellent reputation and foothold in North America, Australia and the UK provides the perfect opportunity for our global growth," said Deepinder Goyal, Zomato's CEO and founder. "We are delighted to welcome Urbanspoon and their audience into Zomato. We will soon be integrating the two platforms to bring the best of both products to all of our users."</span><span style="line-height: 1.5em;">&#xa0;</span></p>
<p><span style="line-height: 1.5em;">The acquisition will more than triple Zomato's restaurant inventory from 300,000 to more than 1,000,000 restaurants around the world.&#xa0;</span><span style="line-height: 1.5em;">In coming months, Urbanspoon traffic's will move to Zomato.com, and all Urbanspoon app users will use the Zomato app.</span></p>
<p><span style="line-height: 1.5em;">Zomato&#xa0;</span><a href="http://techcrunch.com/2014/11/18/you-say-zomato/">raised $60 million in venture funding in November</a><span style="line-height: 1.5em;">&#xa0;from Sequoia, Info Edge and <span>Vy Capital</span>, bringing the total amount of funding raised by the company to $113 million.</span></p>
</div>

Zomato, An India-Based Restaurant Directory Startup, Just Acquired IAC's Urbanspoon To Make Its Move Into The US

<p>The best dishes in America have finally been revealed <a href="http://www.urbanspoon.com/">by Urbanspoon users</a>.</p>
<p>Spicy pastrami, simmering ramen, and maple bacon doughnuts are just some of the highlights from this culinary odyssey around the country.</p>
<p>Keep reading to see the best dishes that the US has to offer, as rated by UrbanSpoon users. </p>
<h2>Best Sandwich: Katz's Pastrami from Katz's Delicatessen in New York, N.Y.</h2>
<h2><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></h2>
<p>Katz Deli is still the best when it comes to the smoky, sweet taste of pastrami sandwich, according to diners.</p>
<h2>Best Noodles: <a href="http://www.urbanspoon.com/dish/5/63832/142650340/ramen-daikokuya-los-angeles" target="_blank">Ramen</a> from <a href="http://www.urbanspoon.com/r/5/63832/restaurant/Little-Tokyo/Daikokuya-LA" target="_blank">Daikokuya</a> in Los Angeles, Cali.</h2>
<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p>
<p>Diners can't get enough of this ramen, made with made with Kurobuta pork with perfectly simmered broth.</p>
<h2>Best Pizza: The Omni Pizza from 575 Pizzeria in Amarillo, Texas</h2>
<h2><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></h2>
<p>Surprised the best-rated pizza is from Texas? Don't be. The omni pizza from 575 Pizzeria has every topping you could ever want, including: pepperoni, sausage, mushrooms, green peppers, and black olives.</p>
<h2>Best Dessert: Bacon Maple Bar Doughnut from Voodoo Doughnut in Portland, Ore.</h2>
<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p>
<p>This caloric overload is a yeast doughnut topped with maple flavored frosting and, of course, bacon.</p>
<h2>Best Burger: The Company Burger from The Company Burger in New Orleans, La.</h2>
<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p>
<p>New Orlean's The Company Burger makes the best burger, according to diners. Their eponymous burger has two patties with onions sandwiched in between, house made b&amp;b pickles, and American cheese. </p>
<h2>Best Dumpling: Dumplings from Gourmet Dumpling House in Boston, Mass.</h2>
<h2><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></h2>
<p>Diners loved the fresh dumplings from the Gourmet Dumpling House, which is consistently rated as one of the best Chinese restaurants in Boston.</p>
<h2>Best Appetizer: Grilled Monterey Bay Calamari from Delfina in San Francisco, Cali.</h2>
<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p>
<p>Defina's grilled calamari isn't like your typical fried appetizer. Diners also enjoyed the warm white bean salad that came with it.</p>
<h2>Overall Best Dish Of The Year: Boulevard restaurant's Filet Mignon in San Francisco, Cali.</h2>
<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p>
<p>Boulevard wins the crown for best overall dish with their awesome take on the classic filet mignon dish.</p>

Diners Reveal The Best Dishes In America

At a time when online food ordering apps and services are on the verge of shutting down, <keyword id="2664725" type="UNKNOWN" weightage="20" keywordseo="Zomato-India">Zomato India</keyword> almost doubled its revenues to Rs 87.5 crore. However, the company also saw losses increase three-fold.<br />
<br /> For fiscal 2016, <keyword id="830092" type="COMPANY" weightage="20" keywordseo="Zomato">Zomato</keyword> India registered revenues from Rs 46 crore in 2015 to Rs 87.5 crore in 2016.<br />
<br />
Info Edge, which owns 47% stake in Zomato, stated that India accounted for 47.3% of Zomato's overall revenues that stood at Rs 184.97 crore for FY16.<br />
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But, the company also made losses in India that shot up to Rs 247 crore in 2016, more than three times from Rs 62.3 crore loss in 2015.<br />
<br />
Meanwhile, Zomato posted losses of Rs 95.9 crore on revenues of Rs 34.7 crore for the fiscal in Asia Pacific region.<br />
<br /> Earlier, Zomato CEO <keyword id="476451" type="UNKNOWN" weightage="20" keywordseo="Deepinder-Goyal">Deepinder Goyal</keyword> had stated that revenue share of India and UAE dipped from 65% last year to 50% as of May 2016.<br />
<br />
In February, Zomato had also claimed to have achieved operational break-even in six countries including India, the UAE, Lebanon, Qatar, the Philippines and Indonesia.<br />
<br />
In American market, Zomato registered a net loss of Rs 327.5 crore on revenues of Rs 6.73 crore for the fiscal.<br />
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Zomato entered the US in 2015 with the $52-million Urbanspoon acquisition.<br />
<br />
In terms of segments, online advertising still dominates Zomato's revenues, accounting for 91.4% of the company's overall revenues. The segment's revenues grew by 76.1% toRs 169.1 crore for FY16, from Rs 96 crore in FY15. <br />

Zomato makes profits but losses also triple

It happened with Dazo, TinyOwl, SpoonJoy and now it is Zomato. In latest signs of turbulence in <keyword id="3105747" type="UNKNOWN" weightage="20" keywordseo="food-technology-industry">food-technology industry</keyword>, online restaurant-discovery platform Zomato is dismissing 250-300 employees, most of them being from the US.<br />
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Zomato’s apparent global restructuring will hit around 10% its workforce.<br />
<br />
Reportedly, the cuts in staff in other countries will not be a large number given the size of those markets. Majority of the pink slips can be expected in content operations as 40% per cent of the restaurants listed on Zomato account for over 90%, 60% consume a large part of its content operations.<br />
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Zomato is spread in 22 countries. Nearly 14 lakh restaurants are listed on its platform, with 70,000 being in India.<br />
<br />
Meanwhile, food-ordering startup Dazo ended operations owing to funding, TinyOwl dismissed 200 people and online-first restaurant SpoonJoy recently suspended deliveries in Delhi and few areas in Bengaluru.<br />
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Following fund crunch in food-tech companies, they are struggling to survive and trying to manage high cost of acquiring customers and tough competition.<br />
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One of the crises is happening during the growth-stage funding.<br />
<br />
Experts say not everyone is going to make in the startup culture and with a plethora of startups, many won’t survive the valley of death.<br />
Reportedly, Zomato raised nearly Rs 390 crore from investors after it acquired Urbanspoon for about $50 million at the start of this year. <br />

Zomato is going to lay-off at least 300 employees! What went sour?

<br /> Restaurant search app <keyword id="830092" type="COMPANY" weightage="100" keywordseo="Zomato">Zomato</keyword> got a huge boost to their business by raising $60 million in funding led by Singapore based Temasek with participation from existing investor Vy Capital. <br /><br />

	"With this round, and with some of our markets turning profitable recently, Zomato is well capitalised for at least two years," Deepinder Goyal, Founder and CEO of Zomato, told ET.
<br /><br /> Zomato will use the funds to make <keyword id="6362476" type="ORGANIZATION" weightage="100" keywordseo="investments">investments</keyword> in its new businesses including online ordering and table reservations. <br /><br />

	"Zomato already has the added advantage in terms of app downloads and credible ratings. Soon they will integrate this with the ordering and if the experience is seamless, it will get them way ahead of competition in much lesser time. The challenge is to develop logistics and technology to serve the delivery platform," said an investor in the company. 
<br /><br /> Founded in 2008, Zomato has in total raised close to $225 million from Info Edge, <keyword id="270604" type="ENTERTAINMENT" weightage="100" keywordseo="Sequoia">Sequoia</keyword> India, Vy Capital, and Temasek. The company is present in 22 countries and has about 3000 employees globally. Zomato had raised Rs 310 crore in April from existing investors including Info Edge and Sequoia Capital. <br /><br />

	Over the past year, Zomato acquired seven restaurant search players in New Zealand, Poland, Czech Republic, Slovakia, Turkey and Italy. UrbanSpoon deal gave Zomato entry into more developed market like Canada, Australia and USA which would pit it against large players like US-based Yelp Inc.

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	<br />
	(Image credits: Indiatimes)

Boost to Zomato's business, raised $60 million from Singapore based Temasek, Vy Capital

<p><div class="KonaFilter image-container float_right"><div class="image"><p class="source"><span><a href="http://www.wboy.com/story/25529155/atomic-grill-in-morgantown-ready-to-show-some-skin">12WBOY</a></span></p></div><p></p></div>A restaurant owner had a tongue-in-cheek response to an UrbanSpoon reviewer who told waitresses to "show more skin." </p>
<p>Daniel McCawley, owner of <a href="http://www.yelp.com/biz/atomic-grill-morgantown">Atomic Grill</a> in Morgantown, West Virginia, <a href="http://www.wboy.com/story/25529155/atomic-grill-in-morgantown-ready-to-show-some-skin">told local station 12 WBOY</a> that he was offended by the suggestion. </p>
<p>"I'm a husband and a father of a 12 year old girl," McCawley <a href="http://www.wboy.com/story/25529155/atomic-grill-in-morgantown-ready-to-show-some-skin">told the station</a>. "I have five sisters and it was just offensive."</p>
<p>McCawley's waitresses wear black polo shirts and pants on their shifts. </p>
<p><span>So McCawley responded-by offering promotions on loaded baked potato skins this Memorial Day Weekend. </span></p>
<p><span>The potato skins will cost $7. Proceeds will benefit the <span></span>West Virginia Foundation for Rape Information and Services. </span></p>
<p><span>The Urban Spoon review has since been removed, <a href="http://eater.com/archives/2014/05/20/restaurant-responds-to-show-more-skin-comment-with-hilarious-special.php">according to Eater</a>. </span></p>
<p>The company's <a href="https://www.facebook.com/AtomicGrill">Facebook page</a> has been inundated with supportive messages. </p>

Restaurant Owner Has The Perfect Response To Reviewer Who Told Waitresses To Show More Skin

<p><span style="line-height: 1.5em;"><div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div><p></p></div></div>T</span>here's a reason several popular apps for ordering takeout and making restaurant reservations look similar and it could be making you more hungry.</p><p>In addition to quickly connecting people to their food, OpenTable, UrbanSpoon, Seamless, GrubHub, and Yelp all have one other key element in common: red logos.</p><p>Grouped together, the apps' visual similarities are undeniable. Each brand features their own unique shade of red highlighted by white accents.</p><p>Scientists and marketing professionals have often drawn <a href="http://www.helpscout.net/blog/psychology-of-color/">connections between colors and the types of reactions people have towards them.</a> People <a href="http://www.businessinsider.com/the-importance-of-a-logos-color-2014-4">associate different feelings with different colors</a>. A blue logo might evoke calmness, for example, while purple is often associated with luxury. </p><p><span style="line-height: 1.5em;">The color red <a href="http://www.businessinsider.com/branding-and-the-psychology-of-color-2012-12?op=1">can signify power and passion</a>, and</span><span style="line-height: 1.5em;"> elicits such strong reactions that <a href="http://www.businessinsider.com/wear-red-to-be-persuasive-2015-3">wearing the color can make a person seem more persuasive.</a></span></p><p><span style="line-height: 1.5em;">Colors also have strong associations when it comes to food. The color red is said to increase appetite and even caloric intake, while a less naturally occurring color, like blue, can deter people from eating. It's a physical reaction.</span></p><p>"Red increases the pulse and heart rate, and raises your blood pressure. It increases the appetite by increasing your metabolism," explains <a href="http://www.psychologistworld.com/perception/color.php">Psychologist World.</a></p><p>Red is so linked to the human subconscious,<a href="http://www.businessinsider.com/what-is-blue-and-how-do-we-see-color-2015-2"> scholars have deduced that it was the first color humans were able to identify after black and white</a>.</p><p>Color has become a key element in corporate branding. <span style="line-height: 1.5em;">Jenn David Connolly, a creative strategist who works with brands like Williams Sonoma, explains this importance on her company website, <a href="http://jenndavid.com/colors-that-influence-food-sales/">Jenn David Design</a>.</span></p><p>"Color influences consumers not only on the conscious level but also on the subconscious level,"  Connolly writes. The idea is to "reinforce flavor visually... to trigger as many senses as possible, even subconsciously," she explains.</p><p> </p><p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p><p> </p><p>This subconscious connection between color and human response is not lost on <a href="https://www.grubhub.com/">GrubHub</a> and <a href="http://www.seamless.com/">Seamless</a>'s Group Creative Director, Rich McClellan.</p><p>"We generally veer towards the warmer color palette. Reds, oranges and yellows convey warmth, and red is even attributed to increasing appetite," McClellan told Business Insider.<span style="line-height: 1.5em;"> </span><span style="line-height: 1.5em;">"Both the GrubHub and Seamless brand colors are red. We use it often as backgrounds with food, and the contrast and general warmth have proven to work really well for us."</span></p><p> </p><p class="center"><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p><p> </p><p><a href="http://www.opentable.com/start/home">OpenTable</a>, a popular app for making restaurant reservations, also considered the human response to red when deciding what color to use branding the app.</p><p><span>"Color is secretly one of my favorite topics," <span>OpenTable brand design manager Kate VandenBerghe told Business Insider. </span></span><span style="line-height: 1.5em;">"The thing that kept bringing us back to red was its relationship to food and photography: beautiful dishes, fresh ingredients, and just the warmth on an experience."</span></p><p> </p><p class="center"><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p><p class="center"> </p><p>OpenTable did not start out with a red logo. The platform colors were originally a combination of a sea foam green and a wine color, explained VandenBerghe.</p><p dir="ltr">The company relaunched their app at the Apple keynote for iOS 7 in 2014, including their new signature color, "Early Girl" red. "Early Girl" is named after tomato that VandenBerghe and her team found at a local farmer's market where they where looking for organic inspiration to rebrand OpenTable. </p><p dir="ltr">"It's such a cute tomato," she said. "Well, at least as cute as a tomato can be."</p><p dir="ltr"> </p><p dir="ltr"><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p><p dir="ltr"> </p><p dir="ltr">Many shades were considered, but VandenBerghe explained that "Early Girl" was a clear favorite from the beginning.</p><p dir="ltr">"We felt like it looked great because the color really connected with our new brand, which was all about the experience of eating and helping people have a great dining experience," she said</p><p dir="ltr">"There are tons of companies in the food space that are red, but we felt for what OpenTable is offering its users, red was an undeniable choice, that cue of always tying back to food," VandenBerghe told BI.</p><p dir="ltr">Yelp's takeout ordering platform, <a href="http://eat24.com/">Eat24</a>, chose red more for its attention-grabbing qualities than for its subconscious connection to food.</p><p dir="ltr">"Red is vibrant and in your face, which is perfect for Eat24 because our mission is putting food in your face," Eat24's founder, Nadav Sharon, told BI. "That didn't seem like a very good tagline, so we said it with a color instead."</p><p dir="ltr"> </p><p dir="ltr"><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div></p><p> </p><p>There are <a href="http://www.washingtonpost.com/news/to-your-health/wp/2014/03/21/want-to-eat-less-change-the-color-of-your-plate/">some studies</a> that show people who are served food on red plates could actually eat less than those who are served on plates of other colors. But as Connolly pointed out to BI, "it's no coincidence that major chains, like McDonalds, have branding colors that feature red, its a color that has always been strongly associated with hunger and eating."</p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/8-fast-food-hacks-mcdonalds-starbucks-chipotle-order-menus-2015-6">8 fast food hacks that will change the way you order</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="dkajVndToH_eibkHev5eQalmsod4EOMi" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

All of these food apps have one powerful piece of psychological marketing in common

<p><div class="KonaFilter image-container float_right click-to-enlarge"><div class="image on-image"><a title_source="Globe Newswire" title_caption="Chef Robert Irvine" class="zoomin" href="http://static1.businessinsider.com/image/5307d0af6bb3f7f961c21ba6-960/robert-irvine-2-2.jpg"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source"><span>Globe Newswire</span></p><p class="caption">Chef Robert Irvine</p></div><p></p></div>Anyone who has seen an episode of "<a href="http://www.foodnetwork.com/shows/restaurant-impossible.html">Restaurant: Impossible</a>" on the Food Network knows that restaurants need much more than mom's classic recipes to survive.</p>
<p>According to a frequently cited <a href="http://cqx.sagepub.com/content/46/3/304.abstract" target="_blank">study by Ohio State University</a> on failed restaurants, 60% do not make it past the first year, and <a href="http://www.restaurants.com/blog/why-do-restaurants-fail/#.UwfKr0JdURI">80% go under in five years</a>.</p>
<p>Why is the restaurant business so tough? We reached out to celebrity chef Robert Irvine,<span> the host of business make-over show "Restaurant: Impossible," </span>to find out. Here are Irvine's top five reasons <span>restaurants fail</span>, in his words: </p>
<h3>Inexperience</h3>
<p>"So many of the restaurants that I save on 'Restaurant: Impossible' are in their current situation because of inexperienced, but well-meaning, owners," says <span>Irvine.</span> "Potential restaurateurs do not realize or appreciate the specific set of demands that come along with owning and running a restaurant. Once realized, it is often way too late."</p>
<p>"The issue is further compounded," he continues, "by trying to fix this situation by bringing in someone with experience to save the sinking ship and ebb the money loss. This can be effective, but it also adds more of a financial burden to the bottom line by bringing in someone who expects to be paid relative to their experience."</p>
<h3>Bad People Management </h3>
<p>"Unlike other businesses where you may find yourself managing just one group of people with one specific skill set, restaurants have a ton of moving parts requiring a diverse group of people with varying skills sets, talents, and personalities," Irvine says. "I have always found that <a href="http://www.businessinsider.com/jeffrey-zurofsky-of-wichcraft-2014-2">the best managers are the ones who have worked their way up the chain of command</a> and started at the bottom (again, going back to the experience factor)."</p>
<p>"Managers who have walked a mile in the shoes of the people they are overseeing are more understanding, compassionate, and seek like-mindedness while providing insight into how best to relate to, approach, and motivate each member of their team."</p>
<h3>Lack Of Accounting Skills</h3>
<p>"So many times on the show - when asked about food cost, labor, and P&amp;Ls [income statements] - the owners just look at me dumbfounded," he says. "But you have to go further by not just knowing proper restaurant accounting procedures but to also maintain and check the numbers you are generating to ensure they are up to date."</p>
<p>"One particular owner was so proud of himself for being able to report a 33% food cost until I dug a little deeper to see that his costs were based on old figures and that the cost of ingredients had risen significantly since he last did his calculations."</p>
<h3>Spotty Customer Service</h3>
<p>"I don't typically give restaurants a second chance if I'm not given a great experience the first time around," says Irvine. "I feel that most people are very much like me in that first impressions determine repeat customership. The way you handle your customers along every step of their dining experience (from being greeted at the door to paying the check) determines whether you will retain that customer, and it is a well-known fact of business that customer retention is much more cost-effective than customer acquisition."</p>
<p>"Furthermore, with the proliferation of user-review sites like Yelp and Urbanspoon, having customers leave with a glowing experience is more important than ever," he says. "As the digital era continues to grow and expand, review sites will, more and more, become the gatekeepers to customer acquisition. The best way to maintain a positive reputation is to ensure flawless customer service and experience."</p>
<h3>Sub-Par Food Quality and Execution</h3>
<p>"As it is the cornerstone of your entire existence, it seems so simple that the execution of your food would be your top priority, but so often restaurant owners just do not realize that they are serving sub-par fare," Irvine says. "It's not from lack of personal taste or quality. More often it's because of a breakdown in the chain of command and quality control. Day-in and day-out food preparation and presentation becomes routine - sometimes almost a factory-like motion - and can lead to steps being skipped and key ingredients missed over a period of time."</p>
<p>"It's like de-evolution," he explains. "Very slowly your most popular dish can start to veer off its intended flavor profile and your cherished execution can stray from what is best for the end product. It's key to consistently re-evaluate dishes and the quality control measures that were set into place. I also insist on regular tastings before service to make sure that the quality of the product is top notch!"</p>

Food Network Chef Robert Irvine Shares The Top 5 Reasons Restaurants Fail 

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<p><span style="color: #000000; text-decoration: none; font-size: 16px; font-family: Georgia, Times New Roman, serif;"><em>This post is part of the "<a href="http://www.businessinsider.com/category/big-ideas" target="_blank">Small Business, Big Ideas</a>" series, in which business leaders, entrepreneurs, and innovators share their stories of overcoming obstacles and achieving success. "<keyword id="1739122" type="UNKNOWN" weightage="60" keywordseo="Small-Business-Big-Ideas">Small Business, Big Ideas</keyword>" is sponsored by Chase. </em></span><strong style="line-height: 1.5em;"><span style="color: #000000; text-decoration: none; font-size: 16px; font-family: Georgia, Times New Roman, serif;"><em><a href="http://www.businessinsider.com/category/big-ideas">See more posts in the series »</a></em></span></strong></p>
</div><p><div class="image-container float_right" style="width:480px"><div class="image"><p class="source">Justin Massa</p></div></div>As the business world increasingly relies on big data to influence everything from major strategic moves to <a href="http://www.businessinsider.com/big-data-in-the-workplace-2013-5">revamping hiring practices</a>, the food industry, one of the country's <a href="http://www.nielsen.com/us/en/newswire/2013/what_s-cooking-in-the-u-s--restaurant-industry--competition.html">biggest and most vital employers</a>, is way behind the curve. </p>
<p><span style="line-height: 1.5em;">Cue one enterprising duo that saw an opportunity in that gap. With massive amounts of menu data becoming available online, Justin Massa and his co-founder Eric Cooper started Chicago-based software service </span><a href="http://getfoodgenius.com/">FoodGenius</a><span style="line-height: 1.5em;"> three years ago to bring big data to the food industry.</span></p>
<p>Massa, 34, isn't a serial entrepreneur. This company is actually his first experience in the startup universe.</p>
<p>"I came from the non-profit world," Massa says. "My co-founder was laying carpet <span>before we started full time."</span></p>
<p>FoodGenius sells a <span style="background-color: #ffffff;">dashboard that r</span>uns analytics on a massive set of data, mostly from newly merged online food-ordering giant GrubHub Seamless and menu aggregator Allmenus, on what 330,000 restaurants around the U.S. are serving. The service allows customers to see data on nationwide trends and details as narrow as a particular protein served in mid-priced Italian restaurants by state.</p>
<p>In a few short years, it's secured big customers such as mac-and-cheese seller Kraft Foods and supermarket chain Safeway. The company was a <a href="http://exceleratelabs.com/portfolio/food-genius/">graduate of Excelerate Labs</a> (now TechStars Chicago) and design consultancy <a href="http://www.inc.com/maeghan-ouimet/ideo-launches-start-up-in-residence-program.html">IDEO's first "startup in residence"</a> before securing its own offices last year, when it raised $1.2 million from investors including Hyde Park Ventures and Hyde Park Angels.</p>
<p><span style="line-height: 1.5em;">We talked to Massa about his experience going from a non-profit to the startup world, whether accelerators are a good idea, and why he loves building a company in Chicago.</span></p>
<p>Our conversation has been condensed and edited for clarity.</p>
<p><strong>Business Insider: Where did the idea for the company come from?</strong></p>
<p><strong>Justin Massa:</strong> It started in a somewhat different place than what we do today. The original idea was for a consumer-facing application, something you'd put on your phone that would help you find dishes at different restaurants. We first came up with this idea in summer of 2010, and we looked at services like Amazon, Netflix, and iTunes. All of them suggested the most granular thing. You went to something like Yelp, and it recommended a place, not an item; same for OpenTable or Metromix or Urbanspoon.</p>
<p>For me, it was like Amazon recommending an author but not a book, or iTunes an artist but not a song. It just totally didn't make sense to me.</p>
<p>I started working on that problem fairly quickly, but realized that there wasn't much of a business solving that problem. Delivering insight to a consumer about what they should eat in the next 20 minutes — there's not a lot of ways to monetize that. The data we were going to process in order to make that suggestion was really interesting for the food industry. Talking to people in the food industry and realizing they were fascinated by data was what led us to what we do today.</p>
<p><strong>BI: You don't come from a startup background, so what led you to start your own business?</strong></p>
<p><strong>JM:</strong> At first I started my own non-profit, then I worked at a place called the Metro Chicago Information Center. A theme of my work from about 2006 onwards was taking really messy, unstructured public data and deriving value. I didn't call it this at the time, but I was really 'productizing' unstructured data.</p>
<p>Right before I started FoodGenius, when I was at the MCIC, we would work with people like the MacArthur Foundation, the United Way, Chicago Community Trust, to take really messy government, public, and social data and help them understand what was happening in a neighborhood when they funded interventions. With MacArthur we delivered this crazy data product that tracked 99 block-by-block indicators of community change — everything from how many potholes were reported to how many arts activities there were to how many times they closed the block for a block party.</p>
<p><strong>BI: FoodGenius went through a startup accelerator. Would you recommend that path to others?</strong></p>
<p><strong>JM:</strong> I would make a qualified ringing endorsement of accelerators. The one that we went through, which was then called Excelerate, is now called TechStars. It was a really great experience. Without the money and the support it gave us, we never would have been able to start the business.</p>
<p>That said, my qualification of going into an accelerator program is that you really have to vet it. Y Combinator is awesome; 500 Startups is awesome; TechStars is awesome. <span>There's this glut of accelerators out there. Some are great and hopefully will help your business. Some are really great ways to waste three months of your time. </span></p>
<p><strong>BI: What are some warning signs you should stay away?</strong></p>
<p><span>If it's brand new, I would be cautious. </span>If the companies that have come out of it aren't still in business, I would be really scared. If the network of mentors and advisors the accelerator puts together aren't the kind of people you need, I wouldn't apply at all.</p>
<p><strong>BI: Why doesn't the food industry have good data and analytics already?</strong></p>
<p><strong>JM:</strong> The food world has really been split down the middle. You've got grocery [on the one side], and restaurants or food service on the other. On the grocery side of the world, they've had data for a long time. Companies like Nielsen and IRI, although they don't describe themselves this way, were some of the first 'big data' companies. They were taking large sets of data that were really messy across lots of different areas and stores, normalizing them, and providing insights about the industry.</p>
<p>On the restaurant side of the world, I think there's never been a robust data industry largely because the data just didn't exist. The fact is, there are still large chunks of restaurants that don't have electronic points of sale, loyalty cards, or bar codes. There's no uniformity of product.</p>
<p>The raw materials which with you could build a data industry were just not there. If we tried to do this 10 years ago, the tech costs would have made it unfeasible. If we tried to do this five years ago, the tech costs would have come down, but the actual data wasn't there at a reasonable scale. Ours is a business that only really makes sense in the last three years. It's largely because Amazon Web Services has just depressed the amount of cash you need to have the technology to start a business like this. </p>
<p><span style="font-size: 15px; line-height: 1.5em;">Now you have things like GrubHub Seamless and Allmenus — tons of menu data on the web that's accessible. You don't have to spend a ton of money or time having to get the restaurant to send you a fax and then typing it in.</span></p>
<p><strong>BI: How do you convince giant chains to trust a tiny company?</strong></p>
<p><strong>JM:</strong> That's a constant concern. There's one thing we learned at Accelerate that I really took to heart, we really apply it to everything. When you're starting your company, especially when you're venture-backed — I think it was Brad Feld who started Techstars who first said this — people invest in lines not points.</p>
<p>What he's saying is you can't come in once and expect someone to write you a check. You need to meet a series of times, tell them what you're going to do, and go out and do it. Then you come back and say, 'Hey, everything I told you I was going to do, I did it. And here's what I'm about to do next.' </p>
<p>The product we're selling is really new. And much in the same way that we raised investment capital, we take that approach of lines not points with prospective customers.</p>
<p>With the large customers, we meet them four to five times over a series of months. We update them on the specifics of the product and more broadly about the trajectory of the business. Eventually they hit that threshold where they say, "I've encountered these people three or four times. I'm starting to see them in magazines. The product gets more exciting every time I see it, so this is something I want to buy."</p>
<p><strong>BI: How is it running a company in Chicago? Is finding talent a problem?<br /></strong></p>
<p><strong>JM: </strong>I love Chicago, and I love running a business here. It's a very livable city; it's easy to get around, and the cost of living is nothing compared to San Francisco or New York. The startup community is growing, but it's not so large that you can't really meet lots of people quickly. Once you're in, it's kind of two steps to almost anyone. There are a lot of Fortune 500 companies in the area who are potential large customers, and they've been very active in the startup world.</p>
<p><strong></strong><span style="line-height: 1.5em;">You highlighted the downside, which is talent; there's less of it. But when I talk to friends in the Valley, there are a lot more people, but there's a lot more competition to get those people's attention. And you're going to pay a 20% premium over what we pay in Chicago. Same thing in New York, though at a 15% premium instead. Yes the talent's a little harder to find, but it's hard everywhere.</span></p>
<p><strong style="line-height: 1.5em;">BI: What's different about Chicago startups? </strong><span style="background-color: #ffff00;"></span></p>
<p><strong>JM:</strong> There's a shared identity of startups in Chicago. There are jokes about it, but Chicago has a very practical approach to building a business, and venture investors are very practical when investing here.</p>
<p>I really like the fact, and this is our own personalities too, that Chicago's idea isn't just to build this giant monster of a thing and then commercialize it, but to build and commercialize as you go. That seems like the way you should build a business. Not everybody likes that, but it's part of Chicago's identity.</p>
<p><strong style="line-height: 1.5em;">BI: What's been your biggest challenge so far?</strong></p>
<p><strong>JM:</strong> <span style="line-height: 1.5em;">One of our big challenges is that the food industry is very insular. It's not uncommon for us to go out and meet with a potential investor or partner, and things that are obvious dynamics of the food industry to us are complete unknowns to them.</span></p>
<p>I distinctly remember in the early days of the business we were meeting with an investor; the meeting ended and they were smiling, excited and engaged. They said, "We think this is a really exciting business, but to be perfectly honest, I don't know what to do because I don't know anything about the food industry."</p>
<p>Especially on the restaurant side of the world, there are very few B2B enterprise software companies that just focus on serving the food industry, and as a result you have a lot more education to do.</p>
<p><strong>BI: What's your long-term goal for the company?</strong></p>
<p><strong>JM:</strong> There are a lot of services that look at the grocery world, a lot that look at the restaurant world. There's nothing that looks holistically at how America eats. We hear from our customers that the channels are blurry. Who competes with whom is increasingly nebulous. You now have grocery products and restaurant products that are directly competing against one another. We think that the industry should not look at its vertical, its corner of the world, but at how people really eat.</p>
<p>Some of it we can do today, some of it we have to figure out. But I think when I look to the future, the biggest idea I see is to be able to really understand what Americans are eating. And on top of that, being able to be predictive about what kinds of flavors, products, tastes, proteins and ingredients are going to be popular in the future.</p>

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