Eat App: Building and Monetizing an End-to-End Dining Experience Solution

Founded in 2015 in Bahrain, Eat App was an up-and-coming player in the global restaurant management software business. In early 2024, having shifted to a product-led growth strategy, the company’s co-founders faced a host of decisions that could greatly impact their annual recurring revenue (ARR) and profits, and hence their ability to fundraise the following year. In particular, an attractive opportunity had emerged with the Four Seasons Hotels and Resorts (Four Seasons). The hospitality chain was considering transitioning its 400 restaurants to Eat App's software. But first, Eat App needed to prove via a pilot that its software could create more value than Four Seasons’ current system (powered by OpenTable). Moreover, the co-founders had to carefully consider the pricing structure to propose and the features to include in the deal for the 400 restaurants. Should all restaurants receive the same software package or should they have the flexibility to choose different features and usage limits? Should certain modules that competitors offered be added and, if so, how should those be priced? How could Eat App ensure the deal was attractive to Four Seasons while still profitable for Eat App?
Simultaneously, the co-founders faced a number of additional pricing decisions. One of Eat App’s major cost drivers was sending SMSs on behalf of its restaurant clients. In certain markets, the cost of sending an SMS exceeded the fixed price Eat App charged restaurants, leading to financial losses. This situation prompted the co-founders to consider whether to stick to fixed pricing rates, though possibly having different rates for various groups of countries, or adopt a fully variable pricing model for SMSs. Relatedly, management debated whether to explore more cost-effective messaging alternatives, such as WhatsApp.