Grubwithus Raises $5M to Expand Communal Dining Platform

Looking to go out to eat with friends, but short on the friends? Startup Grubwithus was among the first to offer an option for organizing dinners among like-minded individuals who might not know each other in an offline setting, though the idea is catching on. Its pioneering status in what looks like it might be the latest trend among foodies is likely part of what led to Grubwithus inking an additional $5 million in funding, announced today.

The Series A round was led by GRP Partners, and also includes individual investor Michel Daher, and adds to Grubwithus’ initial seed funding of $1.6 million, which it announced a year ago. The new cash will be used to help Grubwithus reach out to more restaurant partners, focus and expand marketing efforts, and help drive growth. So far, the site has managed to operate in almost fifty different cities and has doubled its user base, but there’s still plenty of opportunity to grow. Co-founder and CEO Lu told BetaKit in an interview that one of the startup’s goals for the funds is to drive more frequent engagement.

“Our whole mission is to just kind of be a real life social network,” he said. “We want to further that mission, and right now you’ll check the site once or twice a week to see if there are any meals happening, and you’ll go have a meal experience and have a great time, but what about in the future knowing when these casual friends you’ve met are doing other things? So I think just expanding to a place where instead of checking just once every week, you check once or twice a day, just being like a real life event-driven social network.”

In its current iteration, Grubwithus works by partnering with businesses to provide set blocks of seating under a single, pre-arranged bill at a set cost. Diners can then split the bill, tip, etc. in advance, and the app takes care of logistics, leaving users to just show up and eat. For its organization services, Grubwithus adds a small fee of a few dollars to every meal it arranges, making up roughly 20 percent of the overall fixed price set by the restaurant for the menu they prepare for Grubwithus dinners. Lu explained that in approaching restaurants, his company is careful to make it apparent in advance they aren’t a Groupon looking for a huge discount and a steep cut of the potential revenue.

“Restaurants’ number one fear is Groupon. The first question they ask us is, ‘You’re not like Groupon, right?’,” he said. “So we tell them we want to be a sustainable revenue source for them. We tell them obviously we don’t want a huge discount like Groupon […] we say just give us a menu and a price that we’re comfortable with, and then we just basically get a cut of that.”

As for the timing of the funding, initially, Lu said that the startup intended to wait until summer to pursue a new funding round, but after discussing their interest in raising funds with GRP, they were convinced by the investment group that the time was right. And with others like The Social Feed and LetsLunch entering the fray not only in terms of social dining, but also in offline social networking as well, like the soon-to-be launched Unawkward, there’s plenty of reason for Grubwithus to get a head start, especially if they want to expand beyond being just dining events into other areas.

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