When Roberto Casoli, BEng’19, and Eric Haniak, BEng’19, graduated with electrical engineering degrees from McGill, they couldn’t have imagined that one day they would be taking on UberEats, DoorDash and other food delivery services, inspired, in part, by a desire to create a fairer playing field for a restaurant industry that has been struggling during a pandemic.
Instead, the initial plan for CHK PLZ, the startup they co-founded with their partner Olivier Eydt, BEng’18, was to make it easier for people to settle their bills in restaurants – back in the days when people were still eating in restaurants.
CHK PLZ offered a contactless payment system that allowed customers to split and pay their bills from their phones and leave restaurants at their leisure.
That’s the concept that earned CHK PLZ first place in the small and medium enterprise category of McGill’s Dobson Cup in 2019, along with $20,000 in prize money. And that’s the concept that helped them land their first restaurant customer, Grumman ’78, which tested their product.
The Dobson win provided the money and credibility that the CHK PLZ team needed to start partnering with more restaurants, including Agrikol and Nouveau Palais. It also helped them build connections in Montreal’s startup ecosystem, including with an angel investor.
Following their Dobson victory, the CHK PLZ co-founders joined McGill’s X-1 Accelerator program. They didn’t have business backgrounds, so the weekly mentor meetings covering topics like marketing, human resources and financing were invaluable. “Although we had acumen, there are some fundamentals you don’t have unless someone explains them to you,” says Casoli.
Momentum was growing for the company as more restaurants signed up – and then COVID-19 changed everything.
When Montreal dining rooms closed, CHK PLZ’s app essentially became useless. To help restaurants, CHK PLZ made a quick pivot. The team quickly built an online marketplace and uploaded menus for takeout, all for free.
“That made the whole process contactless,” says Michel Nguyen of Asian comfort food restaurant La Belle Tonki, which started using CHK PLZ last July. Customers could order directly on the restaurant’s website or on the CHK PLZ app. It was convenient for diners, but essential for struggling restaurants.
The CHK PLZ team knew they needed to do something more in order to start bringing in money. That’s when they made another pivot that has allowed them to grow sustainably: Last November, they started charging restaurants $30 a month for takeout and delivery with local rideshare coop Eva, plus 30 cents and 2.7 per cent per transaction.
The business model keeps them less expensive than other delivery apps, says Haniak, and it’s also less expensive than the majority of online ordering companies that don’t offer delivery and just plug into the Stripe payment processing platform.
Eva’s delivery fee, usually five to 10 dollars, is added to the diner’s bill rather than the restaurant’s fee. That might sound high compared to the $3.99 delivery fees often charged by other services, but it means Eva’s more than 1,000 member-drivers are paid a fair wage. And since restaurants don’t need to mark up menu prices, it often ends up being cheaper for diners overall, says Casoli.
Dardan Isulfi, BA’20, Eva’s COO, says his drivers love working with CHK PLZ because their customers tip well. He also appreciates that when restaurants sign up with CHK PLZ, delivery is automated, whereas if they work with Eva directly, they need to call drivers themselves.
CHK PLZ has grown to almost 200 restaurants and Eva has gained a lot of new customers. Haniak says CHK PLZ is now trying to onboard other delivery partners, “to keep up with our growth and not overload Eva,” he says.
La Belle Tonki’s Nguyen notes that CHK PLZ doesn’t yet have some features, like suggested dishes that might encourage customers to increase the size of their orders, but those will come. “They’re going to be the app with the cool local restaurants,” he predicts.
Initially, Nguyen signed up when he noticed how CHK PLZ was partnering with respected restaurants like St-Henri’s Satay Brothers rather than fast food franchises. Casoli says they weren’t trying to avoid fast food, but they did want to focus on places where quality is a bit higher, making costs higher and profit margins narrower. “In no world are [those restaurants] able to make money off UberEats,” he says.
Food delivery services have come under increasing fire for charging restaurants too much – their critics have included Montreal mayor Valerie Plante and Ontario premier Doug Ford.
Satay co-owner Alex Winnicki speaks highly of CHK PLZ. “Their partnerships were always very fair and really gave restaurants a chance for survival,” he says. “Another thing is these guys are Montrealers and 100 per cent David versus Goliath. We’re always rooting for the underdog.”
Based on restaurant demand, CHK PLZ also integrated Cluster and other point of sale systems, which Nguyen appreciated because it reduced human error from manually entering phone orders and reduced pickup time since he no longer had to process bills himself.
Casoli says that while his studies in engineering might not be directly related to his day-to-day work, they have helped him navigate the pandemic.
“What you learn in engineering at McGill is how to effectively solve problems with the tools you have. There’s a method,” he says.
The CHK PLZ founders are grateful for the support they received from McGill in their early days. “We’ve been lucky to be involved in the McGill ecosystem, and if we have the ability to give back if they ask for something, we do it right away,” says Casoli.
Casoli and his partners would be happy to be X-1 Accelerator mentors themselves one day. “But not yet!” Casoli jokes.
Let them get through this pandemic first.