OpenTable, the premier restaurant reservation service that has all but taken over Manhattan and other major metropolitan cities made its debut on the Nasdaq last Thursday – rising a whopping 60% in its first day of trading. And, this is after already pricing at above the expected range of $16-18.
OpenTable, based in San Francisco has revolutionized the restaurant industry with its proprietary reservation system that helps restaurants improve their yield management. Some harken the system as the same kind of innovative transformation that the airline industry experienced post deregulation and the subsequent transparency of inventory.
Minimizing the tables left empty each night is a top priority for restaurants who depend on the margin captured from each additional diner. Due to the high fixed capital costs for restaurants, attracting additional diners is critical.
In what was a previously dismal quarter for IPOs, OpenTable provided a shining bright light for start-ups around the country, with a first-day trading performance reminiscent to the 1990s tech boom.