Dinii, a cloud-based restaurant management platform, raises $45M Series B
Reading Time: 3 minutesJapan has always been a strong market for bringing technology into the experience of consuming food, and now one of the startups leading on this idea is attracting investors from across the ocean. Dinii, which lets diners order food from restaurants and shops through a mobile platform, has raised $48 million (7.46 billion JPY). Bessemer Venture Partners and Hillhouse Investment Management are leading the investment, with Ecelectic and Flight Deck Capital participating. Notably, this is the first time that Bessemer is investing in a startup in Japan.
Mao Yamada (CEO) and Kazuki Otomo (CTO) started Dinii in 2018 while still students at the University of Tokyo, after working part-time in restaurants to put themselves through school and realizing how outdated those restaurants’ order and delivery systems were.
‘Since we already have a cloud-based POS platform, we believe we will be able to expand to many more product services such as employee management, [restaurants] reservation, and [food] deliveries, and more,’ he said.
Dinii was inspired by Toast, the cloud-based restaurant management system out of the U.S. that also started with POS and payment services (and also happens to have had Bessemer as an early backer). But Yamada says that he has yet to come across any company in Japan with capabilities (data and financial service for restaurants) similar to Dinii’s.
‘Having been fortunate to be a key investor in Toast in the U.S., supporting it to become a $13 billion company, we see a similar element of success in Dinii: a strong team led by a young and visionary leader, a large underserved market, and the best all-in-one cloud-based solution,’ Bryan Wu of Bessemer Venture Partners said. ‘We are confident that Dinii will emerge as one of the most prominent SaaS and fintech leaders in Japan.’
The Tokyo-based startup has a cashless payment solution, Dinii Payments, that it hopes to parlay into a bigger financial services product for its customers. ‘By first providing the cashless solutions, we can eventually move into back office operations, such as invoice settlement, inventory management, salary payouts,’ said Yamada.
Other areas it hopes to break into include insurance, asset management, and loans, to help restaurants manage cash flow and expand their operations.
Restaurant scene in Japan
Most restaurants in Japan mainly use on-site point-of-sale systems. In other words, traditional restaurants work with companies like Toshiba or NEC to rent an on-site POS system for basic operations. These can be costly and limited in their functionality and are not really set up for modern demands such as ordering from mobile apps, paying by QR codes, cashless payments, and cloud-based customer-relationship-management tools, Yamada said.
By putting the POS system on the cloud, Dinii’s customers — restaurants ranging from SMBs to large enterprises — can offer instant capabilities and gather customer data through mobile ordering. Dinii’s technology helps restaurant owners understand which menu items are popular and enables them to communicate with customers through a CRM (customer relationship management) system, send customized coupons to their consumers, and eventually increase revenues,’ Yamada explained.
Dinii also leverages an integration with Line, the popular messaging app, which allows local restaurants to collect customer data such as favorite menu items, gender, last visit, and the number of visits.
The Japanese startup monetizes in two ways: by charging software subscription fees for its cloud-based POS system and fees for payments made through the cashless platform integrated into the POS system.
More than 900,000 restaurants are in Japan, and the food service market in the country is projected to increase to roughly $475 billion by 2030, up from $214.35 million in 2022. Dinii currently has around 3,000 restaurants across Japan, which is barely 0.5% penetration, so it has huge upside potential for this, Yamada noted.
‘With more than 20 million [registered] users making food orders across over 3,000 restaurants, you can imagine how much traffic volume of data passes through Dinii’s platform every single second. Without revealing too much, we are currently building up capabilities for proprietary data solutions for restaurants that would help them in the future,’ Yamada continued.
Expansion to Southeast Asia
The Tokyo startup also has operations in Osaka — covering the country’s two biggest markets for restaurants. But with the new capital, it plans to expand to other Japanese cities like Nagoya and to countries across Southeast Asia such as Indonesia, Malaysia, Singapore, and Thailand. Dinii’s workforce has quadrupled from 30 employees in 2022 to 130, and it will also be hiring more as it grow geographically.
The startup has raised 8 billion JPY, equivalent to about $55 million, since its inception. Its previous investors include ANRI and Coral Capital.
Ref: techcrunch
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