About Snackpass
Snackpass is a smartphone app that allows users to get takeaway without having to wait in line. Since its inception in Berkeley, Snackpass has amassed a cult following of loyal customers who “Snackpass” breakfast, lunch, and supper. With Uber Eats, DoorDash, Postmates, and a plethora of other food delivery apps on the market, it might be difficult to comprehend what distinguishes Snackpass.
The key is in the app’s social capabilities, which allow users to share discounts with friends, send gifts, and accumulate points. Snackpass has built virality into their platform by combining social and food.
We are seeing the next generation of social startups. Both Facebook and Snapchat, which were created by college students for college students, centred on connecting people through status updates and vanishing photographs. Snackpass is adopting a new approach by integrating the three things that college students like the most: eating, hanging out with friends, and receiving as many discounts as possible.
History – Founders/Early Days
Kevin Tam started Snackpass in his final semester at Yale, inspired by an idea he had while sitting in an economics class. After finishing the initial version of the app, he met his co-founders, Johnathon Cameron from his hometown and Jamie Marshall, who had messaged him after using the app.
When Snackpass was created, the startup ecosystem at Yale was essentially non-existent, and the one business accelerator that did exist, strangely, did not accept them. The creators, who lacked finance, depended on hard labour and tenacity to keep the app afloat.
In the beginning, they partnered with restaurants by going door to door to mom and pop shops and talking personally with the owners. They also posted a bunch of flyers around campus and created referral mechanisms on the app to get the word out.
Making a splash with MVP
It was a simple app that offered discounts and loyalty points to Yale students who ordered pick-up using their.edu account. Snackpass was a terrific method for Yale students to save money and avoid long lines. Snackpass enabled eateries to reach out to the whole Yale campus and serve more individuals.
The MVP was an instant hit at Yale, swiftly infiltrating more than 80% of the Yale campus.
What was the characteristic that powered this early flywheel? Gifting.
Gifting changed their game!
Gifting was a game-changer – people could send food and reward points to their friends on Snackpass. This feature was unique at the time because most food apps did not emphasize this type of social behavior. Funny enough, it was a product decision that came from Kevin’s attempt to flirt with a girl.
Gifting became a special language for Snackpass, similar to Facebook’s poke feature in the early days. People could use it to flirt with each other and bond with friends. Restaurants also loved this feature because it was great marketing. Snackpass has slowly built a network effect through gifting and other social features, differentiating itself within this crowded and highly fragmented food space.
Eating is a fundamentally social activity, and the inclusion of gifting at the heart of the Snackpass offering restored the social fabric to food ordering that had previously been lost due to the multiplicity of rivals in the food ordering arena. Snackpass’ advantage, or the fuel to their development, is in changing what was a logistic/efficiency play (ordering food) into a social/fun one.
Also Read: DoorDash – The Great Food Delivery App And Beyond
What’s so social about it?
Snackpass’s social aspects, such as gifting, are what make it genuinely unique. They are conceivable because of the team’s distinct DNA. Snackpass has a North Star internally: if a feature makes them giggle, they will include it. Valentine’s Day jokes are one of such qualities. 💝.
“On Valentine’s Day, we added puns to all the food items people were gifting. If it was a berry smoothie, we would say ‘I love you berry much’. My favorite one was the pun for drunken noodles, for which we added ‘I’m drunken in love’. We attached these puns to the gifts and this feature became a big hit.” – Kevin
The chicken feature is also very entertaining. By gathering enough points from a certain restaurant, you can hatch an egg and obtain virtual chicken with your pals on Snackpass. It can even be addicting, comparable to Snapchat’s streak feature.
Funding
Craft Ventures led a $70 million Series B fundraising round for Snackpass, a social e-commerce network for eateries, in 2021. Andreessen Horowitz, which led the company’s $21 million Series A fundraising round, General Catalyst, and Y Combinator are among the other investors. A slew of celebrities and major venture investors also contributed, including:
- AirAngels, the Airbnb alumni investor syndicate
- Bastian Lehmann, Founder/CEO of Postmates
- David Grutman, hospitality entrepreneur
- Draymond Green of the Golden State Warriors
- Gaingels
- HartBeat Ventures, Kevin Hart’s venture fund
- Jonas Brothers, Musicians
- Pags Group, the family office of the Boston Celtics co-owner Stephen Pagliuca
- Shrug Capital
- Steve Aoki, DJ, record producer, music programmer, and philanthropist
- Turner Novak of Banana Capital
- William Barnes of Moving Capital, the Uber alumni investor syndicate
Future of Snackpass
Snackpass has suffocated it in recent years, particularly during the epidemic. They are the largest social commerce platform in the United States, with over 500K clients and a sales volume of more than $60M each year. To far, Snackpass has raised approximately $92 million from major institutional investors such as Andreessen Horowitz (headed by Andrew Chen), Craft Ventures, General Catalyst, First Round Capital, and Y Combinator.
As Snackpass expands beyond the healthy college market into cities, the path ahead will be difficult, if not lethal. Kevin and his staff will have to deal with the growing pains of retaining college students after they graduate. How do you employ the brightest people while maintaining a fun culture? How do you decide which markets to focus on first? It’s unknown where Snackpass will be at the end of the day, but we have a feeling it’ll be around for a while.
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