Objective Logistics raises $5.3 million Series A to gamify restaurants

By Adam L. Penenberg , written on July 18, 2013

From The News Desk

Restaurants employ possibly the most underperforming and unprofessional sales force in the world. Often barely trained and living paycheck to paycheck, wait staff often miss out on juicy opportunities to upsell. Instead of generic brand vodka, get the customer to order Grey Goose, and while you’re at it, an appetizer or two and dessert, all of which reap higher profits for the business. A good waiter can influence an entire party of six, if he can key in on the group’s influencer. Gently persuade him to order the fried calamari or a beer instead of a soft drink, and the rest will follow. Like that classic Sam Adams TV commercial, the one with a table of businessmen ordering iced tea at lunch until the head honcho says, “I'll have a Sam Adams,” and everybody else changes his order.

More importantly wait staff function as the customer-facing part of a company. Restaurants want to convert every patron into a regular customer. To do that, service must be excellent. As restaurateur Danny Meyer says, You go for the food, but return for the hospitality. But most dining establishments don’t reward staff excellence. And it’s not like promotions are in the offing.

That’s where Objective Logistics comes in. The Cambridge, MA-based company uses game dynamics to incent wait staff to perform better and in the process add to a restaurant’s bottom line. Today the company announced a $5.3 million Series A round, led by Atlas Venture alongside Google Ventures and Next View Ventures, all of which ante-ed up $1.5 million in a seed round in 2011. Philip Beauregard, Objective Logistics’ co-founder and CEO, says the company will use the additional funds to scale operations and extend its MUSE platform into other verticals such as retail and call centers.

MUSE is Objective Logistics’ software platform, which relies on game mechanics to create a competitive environment, ranking wait staff on a leader board and rewarding them with their choice of shifts and other prizes. On the back end, MUSE taps into a restaurants point-of-service terminals, rifling through all the data generated on a given shift, day or week. It offers managers numbers-based information on an individual server’s performance, enabling them to make changes to increase customer engagement.

Founded in 2009 by a pair of self-described “mathletes,” Objective Logistics grew out of co-founder Philip Beauregard’s experiences working just about every restaurant job as a teenager and through college. He came up with the idea late one night as he battled insomnia and enlisted the help of his friend, Matthew Grace, who previously worked at Oracle developing scheduling software. While the two worked to develop the product, Grace even worked as a waiter at Not Your Average Joe’s, a chain restaurant.

It took two years to knit the 150,000 lines of code, which included regression analysis, non-linear algorithms and exponential permutations, probability, and artificial intelligence, and tie it in to the POS system at Not Your Average Joe’s. About a dozen business flows had to go into creating a layer plan and a schedule, including availabilities, constraints, shift swapping, minimization of overtime, and pinpoint accuracy as far as when people could and couldn’t clock in. The software also had to speak to the POS system and effectively rank people based on their performance.

“Matt’s the mad genius behind our software,” Beauregard says. “He’d probably tell you I’m just mad.”

The company says it is working with nine brands, representing more than 70 restaurants, and reports that restaurants that have tried out MUSE have seen a 2 percent and 8 percent increase in top line sales.

“It hasn’t been easy getting to this point,” Beauregard says. “Enterprise software is tough. Long development cycles, long sales cycles, and a long journey to the Nasdaq if you look at the data.”

The five million bucks in additional capital should help.

[Image Credit: WikiMedia]