Yelp picks up restaurant waitlist app Nowait for $40 million

Yelp has acquired restaurant reservation app Nowait for $40 million, in an all-cash deal, the companies announced this morning. The move will bring Nowait’s waitlist system and seating tool to Yelp, where it’s been integrated in the Yelp app, to complement the existing Yelp reservations product and its mobile food-ordering system, Yelp Eat24.

Founded in 2010 and now headed by Ware Sykes, previously of TheLadders, Pittsburgh-based Nowait had grown its network of restaurants to over 4,000 across the U.S. and Canada, and had attracted a number of big chains to its platform, including Chili’s, First Watch, Buffalo Wild Wings, On the Border, Mellow Mushroom, and others. The company charges its restaurants a monthly fee for participation on its platform, which today ranges from $179 to $249 per month, outside of custom, enterprise plans.

Unlike OpenTable or Resy, Nowait’s angle into this space was that it was going after casual dining restaurants that don’t typically take advance reservations, but instead use a waitlisting system. Its app allowed customers to add their name to that list ahead of their arrival, in order to speed up the time it takes to be sat.

Through its mobile application, guests can also check the current wait times at area restaurants, and they can receive texts when their table is ready. If they were running late, they could reply to the text to let the restaurant know.

Going forward, NoWait’s app for consumers and restaurants will remain, and continue to be improved.

“Right now, we’re going to have both apps,” says Sykes. “We want to make sure we’re creating no disruption for our customers…I think there’s lots more we want to add to the Yelp network – there are tens of millions of consumers on the Yelp network, and we want to bring that network to our customers,” he says.

“We want to use data to make both our restaurant and our consumer experiences better,” Sykes added, referring to how the two companies could be more powerful combined.

The acquisition news is not entirely surprising, given that Yelp made a strategic investment in NoWait last year, which also included partnership plans to integrate NoWait into the Yelp app. As often is the case in deals like this, Yelp found that it would make more sense to just bring Nowait’s team and tech in-house.

Yelp says that the waitlist system had already been integrated into Yelp, allowing restaurants to share their real-time availability with Yelp users. The integration also included the ability to join the waitlist with a tap. Whether you’re using the Nowait app or Yelp, the experience itself is similar. Sykes also confirmed the two are basically in parity at this time.

“Nowait has quickly become an important feature for Yelp users and a valuable addition to our overall restaurant offerings. With this acquisition, we’ll make even bigger strides in the restaurant industry by allowing Yelp users to more quickly move from search and discovery to transacting at a local business,” said  Yelp co-founder and CEO Jeremy Stoppelman, in a statement.

Nowait had raised over $22 million in outside funding, according to Crunchbase, including the $8 million from Yelp announced last year. Its team of over 40 will remain based in Pittsburgh, Sykes says.