Despite the constant merger and acquisition activity and consolidations within the food technology ecosystem, the restaurant software space continues to grow.

In fact, according to Market.US, the global restaurant digitization market is expected to almost quadruple by 2032 to $29.6 billion. As more SaaS solutions flood the restaurant tech sector, one in five operators said they are overwhelmed by their tech stack choices (according to the Nation’s Restaurant News’ Intelligence Tech Outlook Report).

But as operator technology needs constantly evolve, more companies are jumping into the software solutions fray, including some from surprising places. This past week, virtual restaurant company Virtual Dining Concepts launched a suite of 12 tech tools called Linked Eats that is designed to serve as “an intelligence-powered middleman” to connect other elements of the tech stack with real-time analytics. On Tuesday, Blackbird Labs, a New York City-based Web3 restaurant rewards app created by Resy founder Ben Leventhal and backed by American Express, launched a new payments platform called Blackbird Pay.

Both companies had been making waves in the digital restaurant space for different reasons — VDC as one of the top ghost kitchen operators in the industry, and Blackbird Labs as a blockchain-based loyalty platform designed for independent operators — before delving into software solutions for the first time. 

“We will see more restaurant tech-adjacent folks get into the space successfully because they will have enough unique experience or competence that validates their plan,” Paul Molinari, cofounder and CMO of restaurant tech consultancy, Popcorn GTM, said. “For example, Cut+Dry was borne out of the team having built a similar ecommerce experience internally at Sysco…. It’s never too crowded if you have a unique value proposition and a go-to-market advantage with product sales, marketing, or partnerships.”

Virtual Dining Concepts believes that it has a few unique value propositions with its new Linked Eats offering of eight digital tools (and four more in development).

Robbie Earl, president and cofounder of VDC, said that Linked Eats has been in development for three years and stands out from other tech software solutions by leaning away from the tried-and-true dashboard approach and toward more real-time analysis. The offerings include a dynamic pricing tool that can monitor pricing trends in real time, an AI-driven marketing tool that’s optimized on a per-store basis and is designed to get smarter over time, SEO optimization, automated uptime to determine why digital functions go offline, and ops communications, which sends out reports to determine how operators are performing.

Despite this long list of digital tools, Earl said he does not see Linked Eats as a one-stop-shop, but rather as a tech stack mediator that can communicate with and integrate with other tech stack elements. As for the reason behind launching with a suite of digital solutions rather than just homing in on one or two tools, Earl said that they wanted to develop the “biggest value unlock possible” for operators, and that when you take all of these pieces together, they are optimized for the highest return possible.

“We offer an extremely tailored operator’s point of view,” Earl said. “We're our own best customers. We test everything out on [VDC virtual concepts] and find real value that we want to offer to the ecosystem… The tech space always moves in these ebbs and flows of consolidation of vendors…We want to establish ourselves as one of the most trusted partners in tech as we have in virtual brands. We’re not a dashboard; we’re a series of actions doing the work for you.”

While VDC’s foray into software seems to have naturally evolved as a result of the company’s influence in the digital restaurant space, Blackbird Labs chief marketing officer Vanessa Leitman said that launching Blackbird Pay was always a part of the plan. Blackbird Pay is a new payments product powered by the company’s new blockchain, Blackbird Mainnet, and offers an end-to-end payments and check settlement network.

The payments solution allows restaurant customers to check in via an NFC-chip-enabled Blackbird Puck when they arrive to an in-network Blackbird restaurant. They can then select options via the Blackbird app that include splitting the check and leaving a tip, and then leave when they are finished without asking for a check or even paying via QR code. The company likens this experience to a digital version of “an old-school house account.”

“The hospitality industry has definitely made a ton of advancements in restaurant technology, but there has been almost no progress made with payments,” Leitman said. “The presentation of the check is somewhat antiquated, and even if it happens digitally, it can feel awkward because you’re inputting tip while your server is standing there. We wanted to create something easy, intuitive, and beneficial for both restaurants and consumers.”

The proprietary technology is designed to be integrated with an operator’s point-of-sale system and is built around Blackbird’s first product: $FLY, which is the company’s blockchain-backed rewards currency. When using the payments solution to check out at a restaurant, customers can choose to pay for their meal with $FLY points. On the operator side, restaurants will see individual customer dining profiles, which include guest value scores, and data like dining history, which allows operators the option of offering custom rewards and perks to guests.   

“You can have an amazing meal at a restaurant, but then you end up spending 20 minutes waiting for the check,” Leitman said. “This feels like a prime opportunity to shift gears for independent restaurants. The Starbucks app is the creme de la crème of the industry, but the average independent restaurant does not have the resources or understanding to build anything like that. So, we’re just trying to build them something we can give to them super easily.”

VDC and Blackbird Labs are not the first companies to enter the software solutions sector from adjacent industries, nor will they be the last. Cyntra Labs started out as a foodservice tech consultancy company that saw the challenges that operators were facing and developed their own point-of-sale system, alongside a suite of other products including kiosks, kitchen display systems, and digital signage, all of which recently launched. Rolf Gehrung, the new CEO of Cyntra, said that in working with major brands like Wendy’s and Burger King, they noticed that many operators were dealing with “clunky, closed” systems, and wanted to create an “agnostic” POS system that plays well with the entire tech stack.

This trend of new tech industry entrants is likely to continue as technology evolves, with tools like generative AI becoming commonplace in the industry.

“Because of AI, data-rich companies now have new opportunities to leverage their vast amounts of data for profit, and AI-driven data analysis has enabled them to more easily spin off products and services…offering a huge go-to-market advantage for them,” Molinari, of Popcorn GTM, said. “[These companies] are developing innovations internally much faster than ever before and are building their own software solutions to meet specific internal needs when no suitable market solution exists.”

Contact Joanna at [email protected]