In 2014, Ray Reddy burst onto the Toronto scene with his food-ordering app. What began with a few restaurants downtown is now available in 10 cities including Los Angeles, New York and Chicago.
Some startups flame out, but the appetite for Ritual Technologies Inc. hasn’t faded. Earlier this year the company raised $90-million in Series C funding.
Ritual makes it easy for workplace teams to order and bring food back to the office. Its Piggyback feature, which allows co-workers to pick up each others’ orders, has been particularly popular with companies as large as Spotify Technology SA and Goldman Sachs.
Here co-founder Mr. Reddy talks about leaving Silicon Valley, how being an immigrant influenced his approach to business, and the get-rich-quick scheme that made him lose it all – at age 19. He was interviewed for I’ll Go First, a new podcast series about entrepreneurs produced by The Globe and Mail.
Ray Reddy, co-founder and CEO of Ritual, is pictured at Flock Rotisserie and Greens, which uses the Ritual app, in Toronto.Michelle Siu/The Globe and Mail
What was the very first restaurant that joined Ritual, and are they still part of the app now?
The first restaurant was a coffee shop on Bathurst and Front in Toronto called Thor. And they are still on Ritual. We were looking for a spot that was close to our office, but mainly we were looking for an owner who was willing to experiment with us.
The owner of Thor is a guy named Patrick. He’s very tech-forward. When we want to roll out early technology on the restaurant side we’ll typically do it with a few partners first, and that coffee shop is one of them.
Ritual has a lot of competition. What about your character helps you take on Uber Eats and the others?
We’ve ended up in a weird spot with competition. Uber Eats isn’t really a competitor. Food-delivery companies add a bunch of extra fees, so they end up being used by people on the higher end of the income curve. They also tend to provide dinner for groups, whereas Ritual is all about individuals. Ordering food is an everyday habit for the working mainstream population.
The way that we view competition is that the vast majority of food purchased is still people walking in and ordering and paying at the cashier. That is what we have to displace.
What’s one of your biggest challenges?
I think the overwhelming part of being an entrepreneur is there’s the perception that you have almost limitless options. As a company you could do 20 things, but you only have the ability to do one or two, and you have to pick the right one or two. Often you fail because you spread yourself too thin. Being able to cut through that noise and really focus is a super hard thing to do.
How do you keep from spreading yourself too thin?
It’s easy to get distracted. One of the funny things is you can experiment with a lot of things and when they work you say, “Well, it’s great that we tried that because it worked.” When it fails, it’s easy to look back in hindsight and say, “Oh, that was a distraction that we never should have done in the first place.” It’s a weird blend of art and science. Sometimes weird distractions end up being massive opportunities for you.
Name one.
Our app started out being made for individuals. But we observed that it was starting to be used by groups, because fundamentally coffee and lunch is kind of a social thing. So we started to play around with the idea that perhaps we were building a single-player product but the use case was actually multiplayer.
That could certainly have been seen as a distraction early on – you have something that’s working, why change it? So we started to experiment with the feature we call Piggyback, where a person orders coffee or lunch on Ritual and their teammates can hop on to that order. That’s been one of the single most successful and important things we’ve built over the last two years.
Mr. Reddy took a chance on a get-rich-quick scheme in university and lost everything.Michelle Siu/The Globe and Mail
Have you experienced any failures?
Early on, when I was in university, we were trying to build our first company, and a close friend presented an investment opportunity. We needed capital to fund our idea. It was a classic get-rich-quick scheme. I was probably at 18 or 19. The logic all made sense. Long story short, I took the proceeds of the capital we had saved to invest in our company and instead thought of this as a way to increase the value of that. The end result was we lost all of it – like zero. It was probably 15 or 20 thousand dollars, which at the time was everything I had. I was super-upset by it. There were implications for me in terms of how to pay for tuition. It had a very big impact on how I approached a lot of life after that.
You lived in Silicon Valley, then you relocated back to Toronto. Why?
I moved to the Valley [and worked at Google] for a few reasons. One is that when you work for a large tech company, being in their headquarters matters. If you ever want to lead products with a global scope it’s hard to do that out of a satellite office.
I later moved back to Toronto to start Ritual. There is a very local element to Ritual. It’s not one of those software companies that you can build in one spot and then scale it globally. And Silicon Valley is not really representative of typical North American cities. Number one, the number of early adopters there is very high, and often you’ll see products that can work well in the Valley that may not really translate outside of there. The second is that incomes there are just completely out of whack.
Toronto really worked out well for us. Even though it’s not in the U.S., it looks and feels a lot like other U.S. cities. We were also able to stay under the radar for a while. We were able to make a lot of mistakes, learn and get the model right in Toronto. That took us 12 to 18 months, and then we started to launch in U.S. cities.
What were you like as a kid?
I was the oldest of three. I was a quiet, somewhat nerdy kid, into science and space and things like that. My parents bought a computer pretty early on, probably when I was like 11 or 12. In ’95 I was finishing high school just as the internet was really taking shape, and that became something I got really focused on, something I thought a lot about.
Was there anything in your family life that helped make you the right guy to create Ritual?
I was actually born in the Middle East, and my parents immigrated to this country when I was 13. When you’re an immigrant you definitely develop a bit of a chip on your shoulder. When my parents came here they had no family or friends in this country, so a lot of things were very challenging for them. The biggest thing that you learn as an immigrant is that you don’t take things for granted and you kind of lose all entitlement.
From a very early age I believed that nothing would be handed to me, and everything would have to be earned. There is a famous quote that I really live my life by: “Be so good that they can’t ignore you.”
What is your perfect day off?
A hike in the mountains or wine country.
How much sleep do you get each night?
A good seven hours.
What’s your favourite food?
Chicken salad.
What piece of advice would you give your younger self?
It would be about the value of culture and teams. When you go to business school everyone pays a lot of attention to the strategy and finance stuff, and there’s usually very little attention paid to company cultures. Technology companies really have no physical assets, right? We literally are the sum of our people. You spend a lot of time finding and hiring the right people and sustaining the right culture inside of a company.
But if you ask me how you create that culture, the answer is I don’t know. If I look back at what it took to get here, I don’t know if I’d be able to replicate that. A lot of it was good timing, good luck, taking a chance on someone who ends up being amazing and who in turn hires a bunch of other great people. We managed to attract the right people that in turn created a strong cultural foundation.
If I had to give myself advice it would be to probably pay a lot more attention to that much earlier than we did.
This interview has been edited and condensed.
About Ritual Technologies
- Headquarters: Toronto
- In business since: 2014
- Employees: 200
- Revenue: Not available
The office lunch run is a well-entrenched workplace routine that goes something like this: One worker volunteers to pick up food for the group, and co-workers write or shout out their orders, hand over cash – hardly ever the exact amount – and hope they receive what they ordered.
It sounds like a recipe for confusion and mistakes.
Toronto-based Ritual Technologies Inc. has digitized this process and powered it with mobile and social media technologies, data analytics and machine learning. The result: group food ordering that’s more efficient and less prone to error.
Workplace teams that have signed up with Ritual use a mobile app to order directly from participating restaurants. The app lets users know when someone from their workplace has placed an order for pickup so they can piggyback on it. The worker picking up for the group earns points redeemable against future orders.
Ritual, which has raised close to $150-million over five funding rounds, generates revenue by charging restaurants a percentage of each order. At between 10 per cent and 12 per cent, Ritual’s cut is substantially lower than the 30-plus-per-cent that other food-ordering platforms typically charge restaurants, says chief executive officer Ray Reddy.
Mr. Reddy, who co-founded the company four years ago with high school pals Larry Stinson and Robert Kim, says Ritual does more than improve the office food run. Companies can tie the app to internal programs such as employee perks or workplace wellness.
can trimThe app also makes it easier for employers to cater to everyone’s tastes when they’re providing meals during meetings or overtime work. Instead of bringing in the usual sandwiches-and-pastries platter, companies can use Ritual to send workers a credit for a certain dollar amount so they can put in their own food orders.end trim
Since it launched its app in 2015, Ritual has grown its network of restaurants to more than 4,000 in 10 North American cities that include New York, Chicago, Los Angeles and Boston. Toronto is so far the only Canadian city where Ritual is available, but Mr. Reddy says the app is set to hit other Canadian cities over the next six months.
He declined to give the number of Ritual users but says more than 50,000 workplace teams now use the app.
– Marjo Johne
New podcast gives voice to entrepreneurs
I’ll Go First, a new podcast from The Globe and Mail, takes listeners into the minds of Canadian entrepreneurs in leading-edge fields such as artificial intelligence, cannabis and cryptocurrencies.
What makes these leaders tick, not just professionally but in their private lives?
Episodes are published on Thursdays. Here are recent interviewees:
- Geordie Rose is co-founder of Sanctuary, which is building realistic robots designed to do what we do – but better.
- As the CEO of Dot Health, a medical-records-access firm, Huda Idrees is dragging Canadian health care into the technological future.
- Bruce Linton of Canopy Growth talks about hanging out with Snoop Dogg, being a father and sparking cannabis innovation.
- Will Richman of GrowthGenius, a B2B company using artificial intelligence, takes boss-employee bonding to the next level.
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- Solon Angel, chief strategy officer at the AI startup Mindbridge Analytics, thrives amid chaos; he even creates it sometimes.
Look for I’ll Go First wherever you find your favourite podcasts (including iTunes, Google Play Music) or on The Globe and Mail website at tgam.ca/illgofirst.