Sunday, November 30, 2014
No one would ever prepay for a ticket to eat at a restaurant.
For years, Nick Kokonas was undaunted.
He was collecting data, reams of it, showing prepaid tickets increased revenue and wiped out no-shows at Alinea, the restaurant he owns with chef Grant Achatz.
And now, Nick Kokonas is prepared.
He is unveiling a new company with Achatz called Tock, challenging OpenTable and taking restaurant ticketing nationwide.
Fueling the company are A-list investors, including chef Thomas Keller, of Napa Valley's The French Laundry and New York's Per Se; Twitter CEO Dick Costolo, who used to live in Chicago; chef Ming Tsai, of Blue Ginger and cooking-show fame; salesforce.com CEO Marc Benioff; and Chicago's Melman family, whose Lettuce Entertain You empire could supply an early and stable source of revenue for Tock.
Guests at Per Se and The French Laundry will prepay for food but not beverages. Staff will call ticket holders ahead of their meals to gauge food preferences.Next year, after a remodel at The French Laundry, Keller plans to switch his restaurants from phone and OpenTable reservations to Tock — meaning at least one-quarter of the Michelin three-star restaurants in America will run on Kokonas' system.
Typically, guests call exactly 60 days ahead to get a table at The French Laundry and 30 days out for Per Se.
"Who wants to be frustrated and aggravated trying to make a reservation?" Keller said. "This eliminates the aggravation and frustration that some of our guests go through just getting to the reservationists."
Still, Keller is keeping traditional phone calls and OpenTable in place at his other restaurants.
"I'm not sure it works well for Bouchon," Keller said of Tock, noting less competition for reservations there.
And there is Kokonas' next challenge.
Can he convince dining establishments in that Bouchon-band — restaurants without prix fixe and tasting menus — that advanced tickets work?
Kokonas' solution is in the next version of the Tock software, which he and his staff are rebuilding "from the ground up" to offer options to restaurateurs, that would :
•Require prepayment just as Next does, with gratuity and taxes prepaid.
•Require for a reservation a $20 deposit, which is credited to the final bill.
•Offer dynamic-deposit tickets, in which a $20 deposit can be converted into a $30 credit if, say, you're booking on a Monday or Tuesday night, which are typically slower. For higher-end restaurants, dynamic pricing could mean a tasting menu for $65 to $95, depending on the night of the week, said Tsai, adding that he is still tinkering with the numbers for Blue Ginger.
•Offer a ticket price of zero, which amounts to a standard reservation.
•Or require prepayment only for special events, such as a wine tasting or a New Year's Eve party.
Kokonas expects the next version of Tock to be ready in the first half of 2015.
"It's logical to assume we'd be interested in switching over our restaurants," said R.J. Melman, whose father, Richard, was an early investor in OpenTable. "When and how that will look and take place is something that we're still working out."
Jerrod Melman suggested Lettuce may not use the software as a ticketing system at all, meaning offering free reservations. That's a viable option because Kokonas intends to undercut OpenTable on price by about half, the Melmans said.
Meanwhile, Kokonas said OpenTable is planning a ticketing system of its own, a claim the San Francisco-based company declined to address.
"I think OpenTable has increased no-shows," Tsai said. "People make more reservations because it's easier, and just not show."
Tsai's Blue Ginger in Wellesley, Mass., will soon switch to Tock. Still, Tsai plans to keep using OpenTable for now, particularly to keep track of things such as food allergies, which Tock does not offer.He estimated his no-show rate at Blue Ginger can range from 2 percent to almost 8 percent some nights.
"If you lose that table or that seating, you don't ever get that money back." Tsai said.
Tock's new investors, including Chicago's Jason Fried of Basecamp and Kimbal Musk, brother of billionaire Elon Musk and a member of the boards of Tesla and SpaceX, will own 10 percent of the software company. Other partners include Kokonas, Achatz, Chief Technology Officer Brian Fitzpatrick, who walked away from Google to run the software development effort, and some Next investors, Kokonas said.
Kokonas declined to reveal how much Tock is valued at other than to say it is in the "tens of millions of dollars."
The longest wait
Kokonas, a former derivatives trader turned restaurateur, has a history in technology.
He said he learned how to code at 12 and continued through college, later investing in technology companies.
Persuading restaurants to adopt his software was a slow-going process, Kokonas said. The idea gained steam this year after his blog post — lengthy enough to be deemed a Jerry Maguire-esque manifesto — touting the idea, including actual Alinea revenue and no-show numbers before and after Tock's implementation.
"Essentially what I'm asking them to do is blow up their model," Kokonas said.
"Nobody wanted anything to do with it, which is really the hallmark of a good idea in retrospect," he added.
Kokonas envisions making the $695-per-month (pilot program price) service available to all "time-slotted businesses," including dentists and hair salons.
Tock would show customers which seats are available, just like booking for an airline. It can also save high-demand restaurants untold hours of answering phones only to disappoint callers who can't get through, much less get a table.
Among Tock's investors, Keller and the Melmans have been with OpenTable since its earliest days. Keller also is Achatz's mentor, a close enough friend that Achatz named one of his sons Keller.
"If you were to ask me, what's the one restaurant you want on the system over any restaurant in the world? That would be (The French Laundry)," Kokonas said. "It's hard to go to businesses that are successful and say we can make them even more successful. Really? Why don't you just go do it yourself? Thankfully, we did, but it took years of data to prove that, yeah, it really is better."
Kokonas is quite confident in Tock. He derided OpenTable as "the Comcast of the restaurant industry."
"You need your Internet service, but good luck trying to get a technician to help you out," he quipped.
Wylie Dufresne, chef and owner of WD-50 and Alder in New York, noted that there have been single days when 75 percent of WD-50's reservations were from OpenTable.
"OpenTable has been very helpful to us over the years in terms of giving people access to the restaurant and allowing people to book online," he said.
OpenTable counts about 32,000 restaurants as customers and says it seats more than 15 million diners each month.
Still, Dufresne decided on Tock to sell tickets for the final 10 nights of WD-50, which is closing Saturday night after more than 11 years.
"I certainly think that this platform would work for other people and is worth exploring," said Dufresne.
Dufresne said he plans to speak with Kokonas in December about using Tock at Alder, which, like WD-50, uses OpenTable. Dufresne shares his colleague's frustration with no-shows, to the point of keeping a list of people who have made reservations several times only to cancel at the last-minute.
"We now no longer let those people make reservations," he said.
Saturday, November 29, 2014
YOUR WORK IS NOT YOUR LIFE
Why entrepreneurs have to make time to think about who they really want to be
by Howard Tullman
From Inc. – (1,000 Words)
Very few things in our lives are absolute. Everything is measured by degree, from our attention
to our patience to the range and intensity of our emotions.
At the same time, some things are absolute: You can't be all things to all people; you can't dance
every dance; and, throughout your life, you've got to make hard choices, sacrifices, and
compromises, and then you've got to live with them through thick and thin for a very long time.
We become the sum of the choices we make over time; those choices determine the kind of
person we end up being--and how the world sees and values us.
What we become isn't a necessary result of fate or destiny. It's certainly not foretold or preordained.
Throughout our lives we remain a work in progress. Iteration isn't just a business
process; it's also a strategy for a life well-lived. We can bend and shape outcomes to match our
desires if we consciously, actively, and continually apply ourselves. But the good things we all
hope for don't happen by themselves; you've got to pay attention and make them happen.
Purpose, Perspective, Proportion
One of the most critical choices you'll need to make when you start out in your career is exactly
what kind of person you want to be. I think it's somewhat back in fashion these days to be a
workaholic. For some of us it never went out of style. Almost everyone today wants to be an
entrepreneur, build a business, and be a big honking overnight success. But that's only part of the
story. Ultimately it's not about making money, it's about making a difference. It's also about
more than making a living: It's about making a life. And the "you" that you become is a big part
of the life you build outside the office, as well as within your business.
In the frenzy of the work and the world it's really important that you don’t lose your sense of
purpose, perspective, and proportion--and risk losing yourself in the process. Your business and
your work will always be what you do. These things are not who you are. And it's critical right
from the start that you not confuse or conflate the two.
This isn't as easy to manage as you may think. Today too many of us worship our work, work at
our play (fitness uber alles), and play at what little worship we make a part of our lives. Where
are the soul and the value in that? And (assuming that we want to) how exactly do we get
ourselves back on top of things before they veer entirely out of control?
To handle the constant barrage of useful information, occasional insights, and useless chatter that
increasingly assaults our senses and impedes our ability to get successfully through the day we
need a new plan. You can drown in many ways today - in data, in documents, in deliberations,
and in endless discussions. We all need to develop new skills for managing both the data and the
people in our lives. It's similar to the radical and rapid choices that drive the triage process in an
emergency room. But there are many different kinds of choices in the mix.
At work, we tend automatically to focus on the fiercest fires and the highest flames. We let our
attention be directed toward the newest crisis rather than remaining in some kind of control and
attending to the critical things that really matter. Attention is as slippery as mercury, and as
easily redirected. If no one is paying attention to the things that count, people just stop caring.
Once you stop paying attention to the people in your business who are important, and they stop
caring about you and your business, they'll go someplace else, to someone who does pay
attention and who does care. It's just a matter of time.
But that's on the business side of the equation. As the number of physical, mental, and emotional
inputs we absorb each day continues to increase it becomes all too easy to apply the same
systems, formulae, and checklists we use at work to our friends and families. This is where
things can go very wrong very quickly.
That's because some of the people decisions we confront every day aren't mathematical or
subject to standard rules and procedures--they're choices about other people, about feelings, and
about our relationships. These concerns are fundamentally different, non-mechanical, and far
more complex. People aren't products, positions, or policies--they're our co-workers, friends, and
family. There's no fixed formula for getting these things right.
So it's equally incumbent upon us to decide what's truly important in these interpersonal
situations, both in the moment and in the long run, and to devote to them the same passion and
energy we apply to our business problems and concerns. It's a given that there's never enough
time in the day (and that's never going to change); there's never enough of any one of us to go
around (cloning may help, someday); and it's way too easy to find an excuse rather than finding
the time to deal with these issues.
But here's the bottom line: Your family (when you have one) will be a much more important
extension of yourself than any work you do. There's always more work, but you only have one
family. And, believe me, good friends are also few and far between. Friends are the family that
you get to choose--they're hard to find, even harder to leave, and impossible to forget. So, as you
make 'em, make a plan to hang on to them. They're as important an investment over time as
Take a little time now to decide how you'd like things to turn out when you look back in 50 years
at your accomplishments, your family, and what you've built. It's all right there before you.
Everything is possible; ultimately, it's all about what you make of it.
Photo Credits Howard Tullman.
For more go to http://tullman.blogspot.com
Read his Bio http://tullman.com/resume.asp
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