>The round included Rustic Canyon Ventures, Ron Conway’s SV Angel, Yuri Milner, Mark Schwartz, and a follow-on investment by Y Combinator.

A follow-on investment from YC? I wasn't aware that they do follow-ons.

There was a mistake in the article. The additional investment was from SV Angel and Yuri Milner, not Y Combinator. We apologize for the confusion, and the mistake has been corrected.

I wonder if this refers to YC investing money to avoid being diluted by this funding round?

I thought YC specifically did not do follow-on investments because of (paraphrase) what it'd indicate about the companies they don't follow-on with.

So, this is online ordering on your phone?

>"Users skip to the front of the line, receive their item, and get on with their lives."

How will that work in practice? I'm quite sure if I'm constantly skipped over in line by people getting priority over me because they have an iPhone app, I'll discontinue business at the establishment.

You order on your phone, you wait, you pick up your food. If people don't order in advance then they stand in line.

Its a long overdue concept. Being able to have my order ready without waiting would make me far more likely to eat out.

>"Its a long overdue concept. Being able to have my order ready without waiting would make me far more likely to eat out."

Maybe I'm missing something, but I've been placing orders online for years. Order, go pick it up (or even have it delivered!). Obviously the app could simplify that by having all my restaurants there in one place, but I'm not sure the "concept" is new.

This is the essence of take-out. Except, on the phone instead of calling, faxing(!) or ordering online. See: chipotle

The original online ordering systems for pizza places would actually generate a fax to the restaurant with your order.

Ah, i remember reading about xpizza. The manpage included

  BUGS:

  Some of the staff at the pizza place
  don't know how to operate the fax machine.

There are plenty of websites to order take-away (from multiple restaurants) in the UK:

http://hungryhouse.co.uk/ (with iPhone app) http://www.just-eat.co.uk/ http://eatstudent.co.uk/ http://www.eatitnow.co.uk/ (with iPhone app)

All support online payments when you order.

I think a difference is you pay when you order. This means less risk for the merchant (also, a slightly faster pickup).

I worked right next to one of the pilot stores when Subway started order online about 12 years ago.

It worked pretty well. About 10% of the people used it and since everything was made & paid it took a few seconds to walk up and get your order.

The trick is getting the employees to encourage the behavior. The Subway workers would shout every few minutes things like "People that ordered online please come to the front" so that everyone else knew what was going on and people didn't feel to embarrassed for cutting in line.

The thing is you're not cutting them. You just grab a bag from some guy. No pushing in to pay real quick for your pickup.

I have no issue with that.

Some places, like Maggianos Little Italy in Santana Row even have a separate will-call/take-out type pickup window.

If it makes you feel better, my typical experience with online ordering systems is arriving at the restaurant, walking up to the cashier for pickup, saying "I ordered online" and getting a blank stare while they go back and check the computer, and then waiting around for 10 minutes while they make my order (after everyone else already in line, of course). So in practice, it may not be so frustrating for non-users. :)

I'm not sure this app would save those establishments

>PayDragon is based on the premise that waiting in line to purchase items is neither good for the customer or the merchant.

In NY when you see a place with a line you get intrigued. Sometimes a queue is a great advertisement for people walking by.

In the UK, you will generally avoid places that don't have a queue. They must be quiet for a reason, right?

A hungrier person (from waiting in line) might also buy more food (good for the merchant).

The interesting thing about this is that 80% of the restaurants are food trucks. This is perfect for trucks where you inevitably wait on line to order, then stand around in the cold for your order to be ready. Couple with that fact that this can act for a discovery service for trucks, which tend to move and as of now rely on twitter to broadcast their location. But you have to know the food truck exists before you can even follow them. This is a food truck guide and order service in one.

I just downloaded the PayDragon app, and the "Discover" feature is one of the more intriguing aspects. I regularly look for interesting, convenient food, and aside from walk-bys, it's not all that easy to find in my neighborhood.

EDIT: In Manhattan, however, PayDragon only has one restaurant in the "Discover" category right now—it's Murray's Cheese, which might be delightful, but it's also somewhat far and not especially appealing.

This seams like a nice version of seamless.com, no? Seamless could doubtless be made better, but I'm curious as to why a merchant would go with these guys rather than Seamless (which has tons of users already.) As a frequent Seamless user, I'm also not sure why I'd give another app a shot—why would I switch (and I'm to switching, too)? Regardless, it looks nice and quick. Best of luck!

I think one of their main objectives is providing speed to ordering. Instead of providing a full menu experience, they would provide something like six items without customization.

This is funny since one of General Assembly's first blog post was about how this concept of skipping lines wasn't a viable lean start-up idea. Take a look. http://generalassemb.ly/blog/a-case-study-on-getting-started...

Apples and oranges -- I think framing is a big issue: "I ordered 30min in advance from my phone and will take food to go" vs "I would like to pay a premium to get ahead of others waiting in line". The latter obviously stings of people's differing time value of money (or I guess more appropriately, money value of their time).

Yea you are right to some extent, but then what is the difference between seamless pickup or calling and ordering(human interaction, scary i know) and PayDragon? Seamless has a great mobile app too. I think they are entering a red sea.

Genuine question: how is this different from companies that already have significant traction for pickup-orders like GrubHub and Seamless?

I'm following these guys with interest as I'm British and detest queuing. It's a waste of useful time, and frequently I'll bail out before purchase. Something like this is good for employment stats (you still need staff to handle the transaction) compared to automated checkout machines.

This app would, for example, never happen in Greece. Every fast food/street food shop here delivers, and I would be surprised if any restaurant denied phone orders.

The norm here is that you order by phone and your food gets delivered, nobody waits for food.

Is it just me or building such an app should cost $50k-$100k? Why do they need $1.35M?

Sales and marketing. Engineering usually isn't the biggest problem with companies who work with SMBs, particularly in local.

Kickstarting adoption among restaurants. Marketing to get adoption among users.

I think they're competing with at least one company who is pretty far ahead in the market like gopago. Their presence seems pretty big in SF at least...I've used it in SF a few times and it's pretty convenient.

I'm still waiting for major fast food companies to start making their own ordering apps like this. No having to explain complicated orders through an intercom. No having to wait in long drive through lines.

Mcdonnalds in europe has installed touch screens you can order from.

And if everyone uses it, there will be lines. Of hungry people.

The idea is the computer will wait in line, not the person.

i.e. you still have to wait for the food to be ready, you just don't have to do it in person.