OpenTable Acquires Foodspotting for $10MM

by Adam on January 29, 2013

In the second (of perhaps more to come) food M&A deal this year, the user-generated food photo-sharing site Foodspotting.com was acquired by Opentable for $10MM. I’m sure everyone is familiar with Opentable, they were one of the first big tech disruptors in the food space that did something, making the process of booking a restaurant table seamless and low-touch.

http://bits.blogs.nytimes.com/2013/01/29/opentable-to-acquire-foodspotting-for-10-million/

The move for Opentable is an interesting one, especially as food start-ups looking for exits don’t always look beyond the Googles and Facebooks of the world. The entrance into the M&A market of a smaller, albeit strong, competitor bodes well for activity here, but it also signals strongly down market to many of the other dish-specific recommendation engines in the food space. Foodspotting relied heavily on the photos from users to help other users find out “what’s good here?” at particular restaurants. And in this space, they are not alone. Other contenders in this area, as well as newcomers are going to have to contend with the reality that an A+ company that was on a growth trend was acquired at a relatively low premium, given the investment and time involved. What that means for others building businesses here is unclear, but it’s enough to make them sit up and listen.

As for the acquisition itself, there’s much that Opentable can use that Foodspotting has. Based on initial reports, Opentable seems to be planning to pair the photos in the Foodspotting database with the restaurants consumers book, so that users can get a sneak peek at dishes they may want. I personally think that takes some of the serendipity and experience out of it, but others may find that of use. The other really valuable use case could be to harness the Opentable feedback loop after a reservation has ended to get users to upload their food photos to the site.

Whatever way it goes, this is another notch in the belt for M&A activity in the food space, and also a one-up for the benefits of visual search and sharing. I imagine this won’t be the last we hear of it.

 

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