Crains New York - June 17, 2013 - (Page 30)
Continued from Page 29
maximize their revenue and fill
spots,” he added.
He sees the new trend as an evolution of the daily-deal business,
propelled by the growth of smartphones. Upward of 40% of Last
Minute’s appointments are made on
smartphones.
“New and emerging technologies such as mobile adoption and
wireless proliferation have enabled
last-minute services to exist and
thrive,” said Ben McKean, founder
of Savored, a popular dining discount site now owned by Groupon.
Groupon may have kicked off
the digital discount craze during the
depths of the 2008 recession,but the
arena of getting services faster and
cheaper continues to expand. The
spa industry is just the latest to join
the fold.
Bargains always welcome
Of course, the business model is
not new; TKTS for four decades has
been allowing fans to buy Broadway
show tickets for up to half off for
same-day performances. People
have and always will be looking for a
bargain, especially during periods of
economic uncertainty.
“This economy may be officially
over the recession, but people are
still struggling,” said Laura
Mandala, managing director of
Mandala Research, a leading
market-research firm specializing in
travel and tourism. “Companies are
realizing they’ve got to offer the best
product at a great price.”
HotelTonight, a pioneer in
same-day online hotel bookings,
was conceived two years ago. More
than 100 of its 2,500 hotel clients are
based in New York, where users can
save 30% on average, and up to 70%
if they’re lucky.
“At any given moment, 40% of
hotel rooms are empty nationwide,”
said Sam Shank, chief executive of
HotelTonight. “We help fill those
rooms by matching consumers and
hotels. Fifty percent of our clients
ordinarily would not have spent the
Lower prices
for nice hotels
are ‘a huge
allure’
night in a hotel. Instead, these folks
would have gone home, stayed
home or slept on someone’s couch.”
According to HotelTonight,
same-day bookings represent 15%
of the $100 billion U.S. online travel market. The company’s app has
been downloaded more than 5 million times, and revenue is expected
to be up 300% in 2013, compared
with 2012.
“Ten billion dollars is lost [annually] by consumers who book a ho-
tel in advance and are unable to cancel because of policies,” Mr. Shank
explained. “Booking on demand is
very liberating to them.”
Andres Barreto, an entrepreneur
who invests in technology startups,
travels nine months a year and stays
at hotels almost 20 times a month.
“It’s impossible to plan ahead because I never know where I’m going
until that day,” he said. Two Manhattan favorites he’s found from
HotelTonight are boutique properties, the Gem Hotel and TriBeCa
Blu. “The fact you have really nice
hotels at prices that normally wouldn’t be available is a huge allure.”
Price is main factor
Some consumers still prefer the
peace of mind that comes with making plans in advance.
“Last-minute deals don’t always
provide what you want,” said Daniel
Burrus, CEO of Burrus Research
Associates, a firm that monitors
global technology trends.
“These sites offer customization,
but they’re not yet personalized. I
can put down a date and time and
find the best price. But there are factors that are being overlooked, like
being able to cater to what I really
want.”
For example, Mr. Burrus said, he
is used to flying first-class. “Lastminute sites don’t offer that,” he
said, “but a human can. These sites
are filling a need for a certain percentage of the population who are
only focusing on price.” Ⅲ
betterment.com
Immediate gratification
SOURCE
LUNCH:
JON STEIN
by Ali Elkin
An aggressive firm’s
casual approach
J
on Stein is on the hunt for a
Flatiron lunch spot. Betterment, the online investing
company he founded three
years ago, is about to move
into a bigger office on West
23rd Street from its current
SoHo home.
The site is geared toward professionals who’d rather deal with a computer than an investment adviser. It
creates diversified portfolios using
basic user information and the smarts
of a computer algorithm.The company has 37 employees and manages
about $215 million in assets.
It’s a bittersweet moment for Mr.
Stein, 33, who will have to bid adieu
to Café Select, the cozy casual Swiss
restaurant where he frequently meets
with investors and prospective hires.
The place is a hub for a new kind of
power lunch, in which investors
dressing down in checkered shirts
and dark-wash jeans bro
out with stubble-faced
startup CEOs.
How did you get the idea to
start Betterment?
kind of build up a core customer base.
Who is the typical Betterment customer?
A lot of our clients are people like
you and me. They are professionals
who are making money who get to a
certain point where they re-evaluate
their finances and they think, “I
could pay an adviser,” or they do a
search and they come across Betterment and they think, “It seems to
automate and do it all for me but
without the expensive fees of these
traditional brick-and-mortar investment services.”
I hear this restaurant is important to you.
We’re moving to West 23rd Street,
and I’m vocally concerned about how
I will find a replacement for Café Select. This place is really special.
Everyone loves it. You can always get
a table in here. This is like an ad for
Café Select. The prices are good, the
food is good, and it’s casual.
You don’t see many people
in suits. In fact, I love that
about it. People come here
wearing a suit and tie and
they feel uncomfortable. I
CAFÉ SELECT
love putting them on the
212 Lafayette St.
(212) 925-9322
defensive.
WHERE
THEY
DINED
My background is in
consulting to the world’s
www.cafeselect
biggest banks and bronyc.com
So Betterment is a finance
kers. I did risk manageAMBIENCE:
company without the suits
ment, product developHipster cozy. Plaid
and ties?
ment and corporate
shirt and beard
Sometimes on Fridays we
strategy. And in the
suggested but
have a joking formal-Friday
process of doing that, I
not required.
thing. But we’re casual. If
found so many opportuWHAT THEY ATE:
you want to keep that part
nities to improve upon
Ⅲ Schnitzel
of your wardrobe fresh, forwhat they were doing.
sandwich with a
side salad
mal Friday is the opportuAt the same time in
Ⅲ Rösti with Black
nity. Why just have a suit
my personal life, I had
Forest ham,
sitting in the closet? They
opened several different
Gruyère and egg
don’t stay in style forever.
brokerage accounts, and I
TOTAL: $28,
was just searching for
including tip
You hear about fast-growing
something great to do
tech companies finding good
with my money, and nobody was providing the product that deals in the financial district. Did you
I wanted. I felt like I had some of the look there?
right experience.What I was lacking People tell me there’s this progreswas any sort of development knowl- sion. You start in SoHo. You move
edge. I started learning to code a bit. into Union Square or maybe Flatiron.
I was lucky to have a roommate who Then you move into midtown. Then
was an engineer at Google. And he you move downtown as you need
was able to help me build some of the more space. I think I’ll resist ever
early site and coach me through moving downtown.One of the things
what I needed to learn to put togeth- we look for in places is good street life
and good food around. Flatiron is
er the first iteration.
pretty healthy in that regard.We’re on
How did you first build your client base?
the same block there as Eataly, and
We launched at TechCrunch Dis- we’re down the street from Shake
rupt here in New York, and we won Shack, though that’s kind of a false
the best startup in New York, which option because you can never actualwas a huge early win.That was a great ly wait in that line. But we get team
way to get a lot of attention and get lunches a few times a week, and
some early users. We used that to maybe we’ll do some from there. Ⅲ
INSIDE TIP: There’s a small fondue room in
the back of the restaurant.
30 | Crain’s New York Business | June 17, 2013
http://www.betterment.com
http://www.cafeselect.nyc.com
http://www.cafeselect.nyc.com
http://crainsnewyork.com/fast50
http://crainsnewyork.com/fast50
Table of Contents for the Digital Edition of Crains New York - June 17, 2013
IN THE BOROUGHS
IN THE MARKETS
THE INSIDER
SMALL BUSINESS
BUSINESS PEOPLE
OPINION
GREG DAVID
FOR THE RECORD
REPORT: FORTUNATE 100
THE LIST
REAL ESTATE DEALS
CLASSIFIEDS
NEW YORK, NEW YORK
SOURCE LUNCH
OUT AND ABOUT
SNAPS
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