What if opening night were less of a gamble for restaurants?
Accomplishing this is the inspiration behind Dinner Lab’s new venture—what it’s billing as a “programmable restaurant.”
“There is so much guesswork that goes into a restaurant,” said the New Orleans-based start-up’s CEO, Brian Bordainick. “The process for opening restaurants hasn’t changed since the first one opened.”
Starting in mid-April, Dinner Lab will host hundreds of dinners in 10 cities during which 10 chefs will compete to become the upcoming restaurant’s chef. As they do, they also will be testing out multicourse menus.
At these events, guests will submit feedback, judging courses on a variety of criteria, including taste, creativity and drink pairing. Chefs will access this data as well as data from previous events to tweak their offerings to cater to different cities’ preferences.
The programmable restaurant
After analyzing guest feedback, Dinner Lab will then pick the ideal location and narrow the list to two chefs, who will face off at a physical location for a series of dinners to refine the concept and menu.
“I think it leaves less to chance,” said Bordainick about the start-up’s data emphasis. “Some of the brightest minds that I know recognize that they don’t know. Anyone who thinks they have a handle on consumer behavior or taste in this space is either way smarter than me if they actually do or they’re insane.”
The restaurant marks the latest stage of growth for Dinner Lab, which has been hosting “pop-up dinners” since 2012 for members that occur in temporary locations and feature inventive menus for a limited number of people. Members pay upward of $200 per year for access to the dinners and up to $95 per ticket to attend one, which Bordainick said sell out quickly.
So far, the company has raised about $2 million in a seed round of financing, attracting investments from wealthy individuals, restaurant investors and Whole Foods Market Chairman John Elstrott. Dinner Lab is currently raising money for a restaurant group that will oversee the test restaurant, which could open as soon as April.
By relying on data to tweak its first restaurant menu, location and chef choice, Dinner Labs hopes to skirt what it sees as the restaurant industry’s high mortality rate.
Assessing restaurant risk
Though data on overall restaurant closure rates are scarce, one study reflects the difficulty in building a long-term restaurant success.
Roughly six out of 10 restaurants either changed hands or closed in Columbus, Ohio, during a three-year period studied by H.G. Parsa, a professor of hospitality management at the University of Denver. Parsa chose Columbus since it’s a relatively stable market in the center of the country.
Still, Hudson Riehle, the National Restaurant Association’s senior vice president of the research and knowledge group, said via email that there are many reasons restaurants close ranging from “ownership changes and concept switches, to operational cost increases and failure to thrive.”
“A closing isn’t always due to the business failing, per se,” Riehle said. “It can also be that the owner or owners are simply moving on to other opportunities.”
Even with the rate observed in Columbus, Parsa said restaurants are “less risky” for investors than many other industries since most have comparatively little debt when they fail.