Restaurants Reclaiming Commerce from Marketplaces
Hadi Rashid, co-founder of Lunchbox, on vertical SaaS for restaurants
LevelUp selling to Grubhub showed how quickly restaurant software can shift from helping restaurants build direct customer relationships to helping a marketplace deepen its control of ordering. LevelUp had made loyalty and mobile ordering usable for chains that could not build it themselves. Once Grubhub bought it in September 2018 for about $390M, the product sat inside a company whose core business made money from transaction flow and diner ownership, not from giving restaurants a neutral system of record.
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Before the acquisition, LevelUp mattered because it gave restaurants concrete tools they were missing, branded mobile ordering, loyalty points, payment, and customer marketing. Lunchbox started by rebuilding that stack for Bareburger, then expanded into web ordering, loyalty, and guest messaging.
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The economic tension is simple. Marketplace apps can charge 20% to 30% take rates and keep most customer data, while first party software charges fixed SaaS and payment fees. That difference is why Bareburger was willing to spend to replace marketplace dependence after paying about $6M in third party fees in an early year.
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This became a broader category, not a one off reaction to Grubhub. ChowNow, Lunchbox, BentoBox, Popmenu, Toast, and others all built around the same opening, restaurants wanted their own website, app, CRM, and loyalty rails so repeat orders could come through channels they controlled.
The market keeps moving toward software that lets restaurants own demand capture while still plugging into outside delivery networks when needed. The winners will look less like pure ordering widgets and more like a restaurant commerce layer, sitting between POS, delivery providers, loyalty, and marketing, with customer data at the center.