Between PayPal, Square and NFC technologies, mobile payments are heating up. There’s no doubt that your mobile phone will soon serve as your wallet. Today, startup Tabbedout, a platform that allows you to pay your restaurant or bar tab with a smartphone, has raised $3.7 million in additional funding from New Enterprise Associates to complete the company’s Series A round of venture funding, totaling $5.75 million. This brings the company’s total funding to $6.5 million.
Tabbedout’s apps, which are available for the iPhone and Android platforms, partners with restaurants and other establishments to allow users to pay for their bills via the designated app. Unlike other mobile payment platforms, Tabbedout allows users to store credit card information directly on their phone, encrypted and under passphrase protection, instead of on Tabbedout’s host servers. That way, consumers are safe from the threat of lost or stolen credit cards.
Within the app, you can search for restaurants in your area that accept Tabbedout. Once you are seated in a restaurant that accepts the payments platform, you open tab within the app and show this to your server. The server is given a code when you open the tab and you order normally. Tabbedout then ecurely encrypts your name and credit card number and sends it electronically to the restaurant or bar’s point of sale system. When you are ready to leave the restaurant, you enter your tip, select the card you want to use and hit pay tab. Users can also share their experiences with friends via Facebook, Twitter and Foursquare. And Tabbedout supports split payments and will email you receipt from any tab opened via the app.
Currently, Tabbedout has enabled thousands of mobile payments at a network of bars and restaurants across 20 states in 90 cities. Of course, the success of Tabbedout depends on whether the startup can scale its platform to point of sale systems at restaurants/ Last week, the company announced that major POS vendor for restaurants MICROS will now embed Tabbedout into its POS offering, significantly impacting the number of merchants offering.
Tabbedout has doubled both the size of its staff and its national footprint since October. The new investments will be used for further expansion to point of sales systems and restaurants.