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Yelp acquires restaurant waitlist app Nowait for $40M

Yelp had previously invested $8 million into the company, which is available in 4,000 restaurants

Financial trends and news by Steven Loeb
March 1, 2017 | Comments
Short URL: http://vator.tv/n/4905

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Updated with additional comment from Yelp

I hate to admit it, but I've become a really impatient person in recent years, thanks to the Internet. Now I can buy my movie tickets before I get to the theater, I can get a cab in just a few minutes, and I can make a dinner reservation on the spot. No more waiting for me! 

Well, that's not entirely true. There's still some waiting, since some restaurants still don't take reservations (savages!) and instead have waitlists, meaning you put down your name and then stand there waiting to be called. It's a terribly outdated system. 

Nowait is a company that has been taking that system and bringing it into this century. The company offers a waitlist system and seating tool that lets users discover seating availability in real-time, and add their name to restaurant waitlists remotely. 

Now the company has been acquired by Yelp for $40 million in cash,  it was announced on Wednesday. The price includes the partial stake which Yelp acquired when it invested $8 million into the company in August of last year.

Founded in 2010, the Pittsburgh-based Nowait allows customers to browse nearby restaurants for accurate wait times, and then add themselves to any list to avoid waiting. They also receive a text when their table is ready.

Nowait is currently live at roughly 4,000 restaurants across the United States and Canada.

When it invested in Nowait, Yelp also entered into a partnership with the company to allows its users to view restaurants wait times and to sign in via the Yelp app. Now Nowait will be integrated in Yelp Reservations, which the company launched back in March of 2014. The feature was built upon the company's acquisition of table and wait list management software SeatMe in 2013. Users had already been able to use SeatMe to book reservations on Yelp, but this added a widget for businesses to add to their website, and was catered to smaller restaurants not big enough for SeatMe. 

Now Yelp Reservations will be able to include restaurants that don't even have reservations at all.

"To clarify on the integration, the Nowait experience is already available in the Yelp app. We will deepen this integration by providing additional features and utility for both consumers and restaurants," a spokesperson for Yelp told VatorNews. 

Having Nowait allows the company to "provide real-time seating availability that better equips diners to make informed decisions," Jeremy Stoppelman, Yelp co-founder and chief executive officer, said in a statement.

"Nowait has quickly become an important feature for Yelp users and a valuable addition to our overall restaurant offerings. With this acquisition, we’ll make even bigger strides in the restaurant industry by allowing Yelp users to more quickly move from search and discovery to transacting at a local business."

For Nowait, becoming a part of Yelp allows it to have access to a much larger customer base, and even more restaurants.

"We’ve had a successful partnership and we’re excited to align fully with Yelp to drive even faster adoption. Together we’ll have the leading waitlist system in the restaurant industry paired with the largest engaged consumer base," said Ware Sykes, Nowait’s chief executive officer.

Nowait had raised $22 million in funding. Additional investors in the company included Drive Capital, Birchmere Ventures, Sand Hill Angels, Mark Kvamme and Chris Olsen.

Yelp doesn't make many acquisitions. In fact, this is the first company it has purchased since it bought food delivery series Eat24 over a year ago. 

The acquisition of Nowait was already approved by the boards of directors of both companies, and closed on February 28.


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