Chowly, a provider of order integration and other software for restaurants, is acquiring online-ordering company Koala.
Koala powers the digital storefronts of tech-savvy chains like MOD Pizza and P.F. Chang’s. Chowly will offer it to smaller restaurants for the first time.
“Our big focus is really taking what they’ve built, combining it with what we’ve built and bringing something that the SMB space hasn’t seen,” Chowly CEO Sterling Douglass said in an interview.
The companies didn’t share the terms of the deal.
Douglass said he’s looked at virtually every online ordering system over the years, and there were a few things that stood out about Koala.
No. 1, it has good conversion rates, which is a measure of how often a website visitor actually places an order. “A couple percentage points can make a huge difference, because these websites get a lot of visits,” Douglass said.
Koala also has a machine learning function that allows it to recommend menu items based on the time of day or other items a customer has ordered.
“Those are things, to be honest, that we only see in the enterprise space” that will now be available to more restaurants, Douglass said.
By combining Koala’s front-end features with Chowly’s behind-the-scenes software, Chowly can offer restaurants a more fully integrated system. In addition to linking all of a restaurant’s first- and third-party orders to the POS, Chowly can consolidate the data from those orders to help restaurants understand their customers better.
Offering more products in one box also simplifies the IT process, which has long been one of Chowly’s goals. “It’s based on the feedback that it’s just too damn hard for these restaurants to add some of this technology,” Douglass said.
Koala currently works with 40 restaurant chains, while Chowly covers 12,000 locations and 3,000 brands. Together they’ll account for more than 16,000 restaurant locations and 350,000 orders per day.
The combined company will maintain Chowly’s focus on SMBs but will continue to market Koala to chains, some of which might also be a fit for Chowly’s services.
Koala was founded in 2017 and is based in Brooklyn, but its fully remote staff won’t have to relocate to Chowly’s Chicago headquarters, Douglass said.
Koala co-founder and COO Brett Spiegel, CTO Walter Beller-Morales and Chief Product Officer Melanie Norton will stay with the new company, while co-founder and CEO Nat Trienens will remain temporarily to help with the integration.
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