Restaurant loyalty app Blackbird Labs today announced the launch of a new tool aimed at cutting payment transaction fees for restaurants, while allowing customers to settle their check in-app—without needing to track down the server. And in a nod to the crypto technology that makes it work, Blackbird will now let customers pay their check using a token called $FLY, which also functions as loyalty points within the app.
Blackbird, launched in 2022, is the brainchild of the co-founder of Eater and Resy, Ben Leventhal, who started the new company in response to the declining profitability of restaurants. It got its start in New York City but is also available in Los Angeles and Charleston. “I think connectivity between guests and restaurants is eroding,” Leventhal told Fortune on a call.
The latest addition to its restaurant software is called Blackbird Pay, and provides a payments and check settlement network. Blackbird Pay is built on the app’s own blockchain, which hosts the $FLY token.
Blackbird helps restaurants better know their customers by tracking on-chain data about a diner’s spending habits—and is easy to use even for small, neighborhood joints that lack the data teams of big chains. In return for using restaurants on the app, diners generate $FLY loyalty points, which grants them freebies and last-minute tables. Its investors include a16z, Union Square Ventures and Amex Ventures, among others.
Just moved $50 USDC into $50 worth of FLY. Now I’m going to buy a coffee w $FLY. Testing now. GA in two weeks. This is happening. pic.twitter.com/RJhy5vH4JT
— Ben Leventhal (@benleventhal) July 4, 2024
What’s new?
On Blackbird Pay, restaurants are charged a flat rate of 2% per transaction, lower than typical credit card fees which can be as high as 3.75%. From the customer’s standpoint, after checking-in at the restaurant—either in-app, or scanning a sensor—they will have the choice to settle the check using a credit or debit card in-app, or using the $FLY points in their wallet. If a diner doesn’t have enough $FLY tokens to cover their meal, they are able to purchase points in-app using traditional payment methods or the stablecoin USDC. Until now, the loyalty points could be spent on appetizers, cocktails, last-minute tables and merch—but now, they can be deployed to cover the whole balance.
Whereas salons and coffee shops may use punch cards to cultivate customer loyalty, Leventhal thinks when it comes to diners, “it’s a slightly more complicated formula.”
When customers pay in-app, Blackbird Pay can analyze a range of variables for each diner, and translate this back to the restaurant as a customer profile and a “Guest Value Score.” In other words, how profitable are they for this business? Metrics include their prior trips to all restaurants on the network (including their own), what they spend money on and how much, frequency of spend, and how many $FLY points are in their wallet. This allows restaurants to offer perks and fine-tuned hospitality to their most loyal or target customers.
“There is a backdrop for Blackbird which is restaurants talking about how bad technology is, how much they’re paying for it, and what it leaves to be desired in terms of data and connectivity,” Leventhal said. In addition to the new payment network, Blackbird has recently created an in-app messaging feature, which allows diners to direct message with hosts overseeing their booking.
