Can SnagaStool Snag A Shark?

It has happened to everyone. Maybe it’s the day of a big game, or quitting time at the office, or date night - but whatever it is, you’ve decided that you and your favorite drinking establishment need some quality time together.   
Only when you get there, you find out that just about everyone else in a 50 square mile radius has the same idea. And there are no seats at the bar or anywhere in the bar. Nada. Zippo. Not happening.
Now some people resolve to stand and wait, others seek out another watering hole, while yet others turn around and leave to go home. The reaction is largely predicated on one’s initial dedication level going in. But regardless, everyone who has encountered this situation agrees on one thing: “there’s gotta be a better way to do this.”
About a year ago, SnagaStool founder and CEO Jamie Manning was that guy in that bar - as he and his co-founder Adriano Varassin were desperately trying to watch a game. And failing.  
“The place was completely packed and this was even before the game started. I walked over to the bar and I see a woman sitting on a bar stool with two waters on either side of her,” Manning explains. “So my buddy and I asked her to move over a seat so we could sit together. She said no, that she was saving the seats. We asked if we could have the seats until they arrived, and she didn’t like that idea. So we stood behind her and guess what? Her friends didn’t arrive until the second half of the game – and then when they did arrive, they all drank waters for the rest of the game. It was unbelievable.”
Now, some people would have left the bar, some would have ratted the seat snagger out to the bartender and others might have started Boston’s first soccer riot in the bar.
Manning and his co-founder did none of those things. Instead they decided to start a business that would innovate the experience.    
“People are already reserving bar stools,” Manning noted, “bars just aren’t collecting any revenue from it.”
Or at least they weren’t.
Shortly after their day of drinking failure, Manning and Varassin set out to build an app that would allow enthusiastic patrons to pay to reserve a bar stool during an important or high traffic time.  
“Our hypothesis is that if someone is willing to pay for a bar stool and they don’t arrive within the reservation time, they lose their opportunity to grab the stool - but the bar didn’t lose any revenue,” Manning explains. We also think that the average check of someone who’s actually willing to pay for their bar stool is going to be a lot higher than the check of someone who isn’t. ”  
Initially, the ability to control and effectively monetize a bar’s highest peak hours was the most attractive part of the SnagaStool model for its business partners. But as the year went on, Manning and Varassin realized that there was another side to their business which was also a major opportunity – allowing customers to reserve a seat (for free) during off-peak hours.
“SnagaStool was at first really focused on that 10 percent of times bars were really busy - which would be Thursday, Friday, Saturday night and special events. First we were thinking from user perspective that it would be cool if a consumer could just pay to reserve a stool. After speaking with a lot of different bar owners, operators, our partners and our advisors, we started to focus on the times when the bar is trying to attract people to their bars - non-premium times,” Manning shared.  
Manning said that while it can sound a little silly - “bar stool economics” is just as predicated on the law of supply and demand as anything else, and that when it comes to attracting people to a bar off-peak, hospitality becomes key to success.
“We let bars extend hospitality to the guest from the second they walk into the door. Once you arrive everyone from the host, to the manager to the bartender is there and waiting for you,” Manning told PYMNTS. “We want people to feel like Norm from 'Cheers' on their first visit to the bar.”
Plus, Manning notes, the SnagaStool service also allows their partners to wrap rewards around bookings to further drive traffic during those lower volume times so that consumers can get a free appetizer, or pretzels or a discount on ordering a meal.”  
Although event bookings - which SnagaStool now accommodates (meaning people can book “trivia night” or “opening day” with merchants partners) are very important, for bar owners, the real day in and day out concern is making sure the bar is bringing in customers whenever it’s open.
“A bar’s overhead is constant, regardless of it being full or empty. The rent, the lights, employee benefits and salary - they don't change and are not variable at the time of day. So during the afternoons, weeknights - bars need to get butts in the door because once they do get them in the door - they are making money. We’re finding that is really beneficial to the bar.”
SnagaStool has had a busy year, picking up bars and restaurants to test out its app - but on Friday night (April 24), the small Boston startup has a chance to break out nationally as they will be appearing on ABC’s "Shark Tank."  
“We’re going to be pitching our mobile app, pitching making reservations on bar stools or bar tables at any time and pitching that whole dynamic pricing aspect of bar stool economics - when bars are busy they can charge more and when they aren’t they can offer incentives.”
The episode has already taped, and though we prodded Manning with all of the charm that PYMNTS could muster, he would not tell us the outcome - noting only that “everything you see is absolutely real. The way that it looks on television that’s really how it goes. There’s no rehearsal ahead of time - that pitch is really the first time they have seen the pitch.”  
As for whether or not their experience was as “scary” as it looks on TV, Manning said: “If you are passionate and invested in bar stool reservations as our team is - we took it as a huge opportunity for us to really pitch what we’ve been pitching all along. If you know your business, if you are passionate and you know your numbers you should be excited at the chance.”
And though the SnagaStool team is excited that the world will get a better look at SnagaStool Manning says he is really focused on building out the next level of functionality in the app. That will come in two forms - one is to tie the app to location services in the smartphone - so it can be useful to consumers hunting a bar in their area.
The second upgrade is to embed payments in the app itself - so customers can run a tab in their phone and clear the tab when they're done - in a very Uber-like fashion.  
When PYMNTS first spoke to the SnagaStool team - they were only in a handful of bars and were still trying to fully flesh out their plan of attack. A year later, they’re in bars all over the city and heading to Hollywood for their big break.  
So SnagaStool and a cold brew and tune in Friday to cheer them on!  



About: Accelerating The Real-Time Payments Demand Curve:What Banks Need To Know About What Consumers Want And Need, PYMNTS  examines consumers’ understanding of real-time payments and the methods they use for different types of payments. The report explores consumers’ interest in real-time payments and their willingness to switch to financial institutions that offer such capabilities.

Click to comment