Image: Promo Pads
Our Start-up of the Week is Promo Pads, a Kildare-based company that promises to give people back the 2.5 months of their life they would have spent queueing for food and drink.
“We are the only custom digital tabletop ordering system in Europe. Digital menus on tables in bars and cafés so you can order direct and don’t have to queue. Nobody likes to queue,” explained Promo Pads CMO and co-founder Manuela Bologheanu.
Promo Pads’ tabletop ordering system Dine was designed to allow customers of coffee shops, restaurants and pubs to simply sit down, relax and order from the table – no more queuing, no more waiting for a server to take their order.
‘Our ultimate goal is to have one of our menus on every table in every bar, café and quick-service restaurant, so none of us ever have to stand in a queue or crane our neck looking for a server again’
– MANUELA BOLOGHEANU
According to Promo Pads’ own market research, the average Irish person loses more than 19 hours each year queuing for food and drinks at lunchtime.
The average time people spend queueing for coffee or food is five minutes and 46 seconds. In total, that is more than 41m hours that Irish people waste each year waiting for food or drink service.
The market
“The opportunity is vast,” Bologheanu said.
“Theoretically, every hospitality table worldwide is of interest to us. Right now, our focus is on the café and bar segments in Europe, but we’ve been building our system so we can package and ship worldwide in the future.
“We’ve designed the system so it can slot in alongside and complement any existing point-of-sale system, so we don’t have the barriers to entry that EPOS (electronic point of sale) systems have, yet we are revenue-positive for premises.”
The founders
Promo Pads co-founder and CEO Diarmaid Murphy. Image: Promo Pads
Diarmaid Murphy is CEO of Promo Pads. He retired from his 15-year career as an army officer dealing with food service efficiency projects and technical project management so he could pursue the business.
Bologheanu’s background is in mass media and marketing. “I started out as a journalist, worked my way up to editor and then moved across into marketing, and I’ve been specialising in digital marketing and social media now for five years.”
Promo Pads has two non-executive directors who are heavily involved.
Philip Brown is general manager of Teamsoft and has 25 years of experience in advertising, having previously been a director of CBS Outdoor prior to its sale for €225m to Platinum Equity.
Dermot Hennessy is operations manager for Paddy Power Betfair and has more than 20 years of technology and start-up experience.
Bologheanu said: “We hired a number of interns, permanent and part-time staff in 2017 who have been working with us building the system over the past year.”
The technology
Image: Promo Pads
At a basic level, the product consists of a number of pieces of software, which speak to each other inside a premises.
“Getting the communications protocols locked down so the system can evolve as an IoT device network was a challenge, as we found that technologies like Wi-Fi Direct are still less mature than we would have liked,” Bologheanu explained.
“We generated a number of patent applications during the development, which was positive for the business. Also, at a time when all the hype says you should take the easy road and just create an app for download, we realised that third-party apps for in-premises food service simply haven’t taken off to the extent that apps for take-out have.
“We also identified significant business advantages to putting a customised for-purpose physical menu device into people’s hands, having it there on the table whenever it’s needed. So, we took the hard road of developing and combining a variety of commodity and custom hardware to create our own digital menu units.”
Bologheanu said that the digital menu concept at a basic level has been proven in the US.
“But, just like MySpace moved for Facebook, we’ve identified a much better business model than exists in the USA, tied into what we believe will become known as ‘IoT advertising’ over the next decade.
“Our ultimate goal is to have one of our menus on every table in every bar, café and quick-service restaurant, so none of us ever have to stand in a queue or crane our neck looking for a server again.
“There are more than 2m food service premises across Europe, and we aim to own the tabletop space in all of them. We generate more money for premises owners, make their lives easier and save everyone else from having to queue – its a win-win.”
Meals and deals
Promo Pads has progressed rapidly in just six months.
“It’s been going great. We put our own money up and received some investment from friends and family last year, and in only six months we developed and launched our beta of the only custom digital tabletop ordering system in Europe and the only dedicated IoT advertising network in the world.
“These pilots proved our value in the tabletop space and, crucially, we’ve proven end-user acceptance and engagement with our tabletop IoT advertising promotions for our revenue model at scale.
“We’ve also had some really positive feedback from large café and restaurant chains who are waiting to see our production system. We just launched a 20-day campaign on Kickstarter on Tuesday 17 April to raise €100,000 so we can push forward from beta to production-ready. Once that closes, we’ll be speaking to angel investors.”
The detail in retail
As entrepreneurs such as PCH’s Liam Casey have said before, hardware is hard work, and Promo Pads is well aware of this.
“Any time you go down a route which involves hardware as opposed to just creating a piece of software, there are going to be challenges,” Bologheanu affirmed.
“Investors are afraid of hardware, and in many cases for good reason. In our case, this is amplified because our revenue model needs a minimum number of tabletop menus in order to kick in. But our business model is designed for exponential revenues.
“As our network increases beyond critical mass, the overall value and hence the revenue per digital menu increases significantly. We don’t produce for X and sell for Y; we license our system hardware to premises, which is a model the food and drink industry is familiar with now for decades, but investors are reluctant to embrace it.
“This licence covers the systems capital cost over its depreciable life, but is still less than the increased profit and reduced overheads which the premises gets from the system. With the hardware costs taken care of, we then generate recurring gross profit from other revenue streams, including software add-ons and our unique, patent-pending IoT advertising model.”
Taking a punt
Bologheanu points out that the start-up scene in Ireland is not as rosy as it is often portrayed.
“The scene is usually called vibrant and very active, and in many ways it is.
“But it is very hard in a small start-up scene like Ireland to find firms or investors who are truly willing to take a punt on a start-up team; to invest in the progress, belief, tenacity and commitment a team has shown, until the business has almost reached a point in revenues where they don’t need the investment any more.
“It is widely mentioned that seed investment requirements in Ireland are the same as Series A investments overseas, thus the chasm you need to cross from initial proof to Irish seed can be vast. True seed-stage risk finance is something which is needed in Ireland.
“No doubt there are many otherwise global-scale Irish start-ups who failed because the market was just too small to find the support they needed when they needed it for their particular business.”
Undeterred by the sparse seed funding environment, the Promo Pads team’s ambition is evident.
Bologheanu’s advice to fellow founders?
“Move to the USA! Just kidding. Although, we have had that conversation in the team; I guess most start-ups do at some point. No, there are some really great supports in place from Enterprise Ireland to help people with a good idea initially get off the ground, and there are new supports being announced annually at EU level.
“But I would say that, before you go down the line of building the business you’re passionate about, look at whether it’s a business that can scale without external finance.
“If not, then think long and hard about whether it will fit in to the funding landscape where you’re based and, if it might not, then relocate before you start.”
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