Resy and Eater: Ben Leventhal - How I Built This with Guy Raz

Summary

How I Built This with Guy Raz: Resy and Eater - Ben Leventhal

Released on January 20, 2025

In this compelling episode of How I Built This, host Guy Raz delves into the entrepreneurial journey of Ben Leventhal, the visionary behind Eater, Resy, and his latest venture, Blackbird Labs. Ben's passion for the restaurant industry and his innovative approaches have transformed how diners interact with restaurants, navigating through challenges and seizing opportunities to build iconic brands. This summary captures the essence of Ben’s story, highlighting key discussions, insights, and pivotal moments from the episode.

I. Early Career and the Birth of Eater

Ben Leventhal's journey began after studying finance at George Washington University and working at VH1 in New York City. Reflecting on his early career, Ben shares:

“The first thing I did there was I worked on the big shows, sort of things like Storytellers and VH1 used to have a show called Divas, which was a big concert…”
— Ben Leventhal [05:44]

Feeling stagnant and lacking progress in his role, Ben started exploring his passion for restaurants. This led to the creation of a newsletter initially titled "She Loves New York", which evolved into the renowned Eater blog.

“The first thing I did there was I worked on the big shows... Whatever, yeah."
— Ben Leventhal [05:44]

Ben recounts how Eater began as a simple newsletter, garnering a cult following with around 10,000 subscribers at its peak.

“It was really just commentary and color and observations... It developed a kind of cult following.”
— Ben Leventhal [08:50]

II. Partnership with Lockhart Steele and Growth of Eater

Ben's collaboration with Lockhart Steele, the then-managing editor of Gawker, was instrumental in scaling Eater. Their partnership began when Gawker linked to Eater, significantly boosting its traffic.

“Gawker was very, very snarky. Yeah, yeah."
— Ben Leventhal [11:27]

Together, Ben and Lockhart expanded Eater beyond New York, maintaining a unique voice that resonated with readers. Despite not being traditional food critics, their energetic and sometimes snarky reviews, especially the infamous "Death Watch" section, attracted both praise and criticism.

“We were just so...all energy and that often showed up as snark.”
— Ben Leventhal [16:22]

III. Transition to Resy and Initial Challenges

After stepping away from Eater, Ben sought to solve a recurring problem: securing reservations at sought-after restaurants. In 2014, he partnered with Gary Vaynerchuk and Michael Montero to launch Resy, a restaurant reservation platform aiming to optimize table bookings through a surge pricing model.

“We thought that was our wedge surge pricing.”
— Ben Leventhal [32:01]

Resy's original model allowed diners to pay a premium for high-demand reservation slots, similar to Uber's surge pricing. However, the concept faced significant resistance from both consumers and restaurant owners.

“You can generate revenue, you can make customers happy, and all you have to do is you have to charge for your primetime inventory.”
— Ben Leventhal [35:09]

IV. Pivoting Resy and Achieving Success

Acknowledging the shortcomings of the initial model, by late 2014, Resy pivoted from paid reservations to a comprehensive reservation and table management service, focusing on providing restaurants with better control over their bookings without per-cover fees.

“It became clear that this was not going to be as big as we thought.”
— Ben Leventhal [44:12]

This strategic shift led to the introduction of features like reservation widgets for restaurant websites and a universal guest database, which significantly enhanced Resy's value proposition.

“If you have four restaurants, it's all one database... Now you can start to track them across your group.”
— Ben Leventhal [53:46]

V. Acquisition by American Express and Crisis Management

In May 2019, American Express acquired Resy for approximately $200 million. Although Resy was not yet profitable, the acquisition provided stability and resources, especially crucial during the COVID-19 pandemic.

“We were inside of it when we sold it to Amex. We were not profitable.”
— Ben Leventhal [53:46]

During the pandemic, Ben remained as CEO and took decisive actions to support restaurants, including cutting fees to zero and advancing funds to help them manage payroll during closures. These measures solidified Resy's reputation as a supportive partner in the industry.

“We cut fees to zero... We thought it was really important, symbolically, to say we are not in a position to be collecting money from restaurants right now.”
— Ben Leventhal [54:40]

VI. Launching Blackbird Labs: Revolutionizing Restaurant Loyalty

After stepping down from Resy in November 2020, Ben conceived the idea of a restaurant currency. This vision culminated in Blackbird Labs, launched in 2023, a loyalty program designed to unify restaurant rewards into a single, cohesive system.

“Blackbird is a loyalty company for restaurants... It takes all the restaurants in the world and turns them into one big giant coalition loyalty program.”
— Ben Leventhal [57:05]

Blackbird operates by allowing diners to earn points at any participating restaurant and redeem them across the entire network. This system benefits both customers and restaurants by facilitating seamless rewards and fostering customer loyalty.

“We backstop all of the points with USD... And over time, what we hope is that they will hold it as points and use those Points for future rewards.”
— Ben Leventhal [57:50]

As of the podcast, Blackbird Labs has 500 participating restaurants and aims to create a global currency for the restaurant industry, enhancing both customer experience and restaurant profitability.

VII. Reflections on Success: Luck, Timing, and Execution

Throughout his journey, Ben emphasizes the interplay of timing, luck, and execution in achieving success. While his unique insights and strategic decisions have been pivotal, he acknowledges the importance of external factors in the growth of his ventures.

“I think luck and timing matter a ton... But, I mean, these businesses are really tough.”
— Ben Leventhal [60:25]

Ben’s story underscores the resilience and adaptability required to navigate the dynamic landscape of the restaurant industry, highlighting how innovative thinking and strategic pivots can lead to enduring success.

Conclusion

Ben Leventhal's entrepreneurial saga, as detailed in this episode, offers invaluable lessons on passion-driven innovation, the importance of flexibility in business models, and the significance of supporting industries through challenging times. From founding Eater to revolutionizing restaurant reservations with Resy and pioneering loyalty programs with Blackbird Labs, Ben's contributions have left an indelible mark on the culinary and tech landscapes.

For entrepreneurs and enthusiasts alike, Ben's journey exemplifies how deep industry appreciation combined with strategic vision can build iconic brands that not only thrive but also uplift the communities they serve.

This summary is based on the transcript provided and aims to encapsulate the key discussions and insights shared by Ben Leventhal and Guy Raz during the episode.

Transcript

Guy Raz (0:00)

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Ben Leventhal (2:20)

I don't think people understand quite how hard restaurants are. If you think about the moving parts at the average independent restaurant and how complicated the production and assembly and delivery of food is to the table, and you compare that to any other small business, it's orders of magnitude more difficult. I mean, you don't walk into a store and say, I need a pair of socks and sneakers and somebody down in the basement makes you the shoes and socks. Yeah, but that's what happens when you walk into a restaurant.

Guy Raz (2:58)

Welcome to How I Built this, a show about innovators, entrepreneurs, and the stories behind the movements they built. I'm Guy Raz, and on the show today how Ben Leventhal's appreciation of restaurants helped him build Eater and then Resi, a booking service that over the past year has seated 350 million diners. If you ask me to name my favorite restaurant, it's pretty easy. It's a place where they know me. Now, the food happens to be spectacular, but even if it wasn't, the fact that I'm a regular means my experience there is always great. And that's the thing about eating out. Even if the food's just average, but the overall experience is great. You'll probably have a pretty good memory of the place. And that's what mattered and still matters most to Ben Leventhal. All three of the businesses he founded or co founded are ostensibly about food, but really they're not just about about food, but about the experience of enjoying the place where the food is served. Back in the early days of blogging, Ben started writing about New York City restaurants, and the blog eventually became Eater, which is now owned by Vox. Eater would report on the rise and fall of restaurants, much in the same snarky voice that Gawker used for celebrities. When Ben stepped away from Eater, he wanted to figure out a way to solve a problem he'd often run into how to snag a table at a hard to book restaurant. So in 2014, he partnered with Gary Vaynerchuk and Michael Montero to launch Resi. Today, Resi is one of the big restaurant reservation apps, along with others like OpenTable and Talk. The original model for Resy was a little like Uber and surge pricing. If you were willing to pay a premium for, say, a Friday night, you could reserve a table at an in demand restaurant. Now, eventually that model didn't work out and Ben and the team had to make a hard pivot, which you will hear about. Resi was eventually acquired by American Express for around $200 million, and today it lists around 16,000 restaurants on the app. Ben has also launched a third company. It's called Blackbird, and it's tapping into the world of restaurants, rewards, and virtual currency. But we'll get there a little later. For now, what you need to know about Ben is that he grew up, studied finance at George Washington University, and out of college, his first job was working at VH1 in New York City.