PayDragon Launches Mobile Ordering and Payment System for Food Vendors

PayDragon, a new app for Android and iPhone and companion web-based backend for managing mobile payments and food ordering, is today announcing its public launch in the Los Angeles area where the company is based. The app, which comes from the team behind early QR code pioneer Paperlinks, debuted in a limited trial at SXSW in Austin earlier this year, and PayDragon CEO and founder Hamilton Chan thinks that based on that experience, he’ll have a hit on his hands.

“The merchants and the consumers were really happy [during the SXSW trial],” Chan said. “The number one feedback I got from consumers was that it’s simple, and the number one feedback I got from merchants was also that it’s simple. We felt like it really rung true for merchants and for consumers.”

PayDragon does away with customization options, lengthy menus, and an overdose of branding from individual restaurant partners. Instead, users are presented with an attractive, clean user interface that puts the focus on food, allowing customers to order quickly and pay for items from their favorite lunch spot or food truck in advance, and be notified via push when it’s ready to pick up. Users also can view their receipts in-app, and are also emailed a copy for records or expense claims. But the key aspect is that menus are distilled to put the focus on a restaurant’s most popular items, with minimum fuss and complication.

“We weren’t sure of whether merchants would be cool with the idea of having a simplified menu,” said Chan, talking about the decision to not offer customization options that would allow user to, for example, add or hold cheese, and also to limit the items available to a specific few. “But a lot of times merchants find that when customers get up to the window and ask them ‘What are the popular things, what should I get?’ and this way they can really tell customers easily what the bestsellers are.”

Chan’s simplicity mantra doesn’t just apply to the customer-facing aspects of the app. Merchants get a straightforward web dashboard with a mininum of required interaction to handle orders; basically, orders come up, vendors tick a box when they’re ready, and customers get a push notification on their device. Even payment on the merchant side is simple, since people using the system only pay a percentage fee on transactions made, and that’s it. Chan said making sure there weren’t any add-on or monthly recurring fees was an important aspect of what he wants to offer with PayDragon.

While he couldn’t reveal the specific percentage PayDragon collects on transactions, Chan did say it was “very small.” Indeed, it would have to be to compete with what similar products from Square and PayPal are offering, which charge 2.75 and 2.7 percent per transaction respectively. Chan thinks that what PayDragon is offering is essentially different from Square and PayPal’s mobile payment solutions, as well as from even more similar in-store shopping systems like the one put out by AisleBuyer, now an Intuit subsidiary.

Chan said that PayDragon’s simplicity is again its defining feature when discussing the competition. “We feel like that’s the way to do mobile shopping; just a single thumb tap and away you go,” he told BetaKit. Chan hopes to expand to other areas outside of the food industry in the future. It also can work with QR code print materials for simple shopping via paper menus, which makes it a potential competitor for companies like SecondMenu, too.

The approach taken by PayDragon is a calculated risk; trade-offs in terms of customization and branding opportunities result in a slick, efficient ordering process on a platform that requires almost no installation or setup. For food trucks, the appeal is clear and the use case makes sense. As PayDragon attempts to expand to other areas, the lack of customization might become more of a liability, but Chan and his team are clearly hoping the benefits in terms of a frictionless shopping experience, and how that could increase conversion, will ultimately outweigh those downsides.

PayDragon hopes to expand geographically outside of the L.A. area soon, and urban centers with busy, smartphone-toting professionals who want lunch to go as quickly and painlessly as possible are the next logical step. Chan says the app could also add options like providing an ETA to customers based on order volume when they make their purchase, and the app already includes gamification elements via points that can redeemed for merchant coupons, Facebook integration and a deals tab to highlight area special offers, so while it’s simple, it’s also not without features. Time will tell whether PayDragon hits the sweet spot in terms of trading complexity for convenience.

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