Blackbird Labs Soars with $50 Million Series B, Revolutionizing Restaurant Loyalty with Blockchain
April 8, 2025
Blackbird Labs, a company aiming to redefine restaurant loyalty and payments through blockchain technology, has secured $50 million in a Series B funding round. This investment signals strong confidence in Blackbird’s vision to create a more equitable and engaging ecosystem for restaurants and diners alike.With approximately 1,000 restaurants already on board, Blackbird plans to utilize the funding to launch its innovative cross-restaurant “points” service, known as blackbird Club, and expand its footprint beyond its current hubs of new York, San francisco, and Charleston, South carolina.
The Series B round was spearheaded by Spark Capital, with significant participation from Coinbase Ventures, Amex Ventures, and Andreessen Horowitz, all of whom also invested in Blackbird’s $24 million Series A in 2023. While the company’s valuation remains undisclosed, industry estimates pegged Blackbird’s worth at approximately $124 million during its previous funding round.
Charleston: Blackbird’s Test Kitchen
Blackbird’s strategic focus on charleston, South Carolina, raises an eyebrow. CEO Ben leventhal explains, “Charleston punches above its class. It’s a great restaurant city for its size.” He further emphasized charleston’s significance, stating it as “a good test market for us.” The city’s vibrant culinary scene and engaged consumer base make it an ideal proving ground for Blackbird’s new initiatives, akin to how tech companies frequently enough use smaller markets to refine their products before nationwide rollouts.
Flynet: A Deeper Dive into Blackbird’s Blockchain Payment System
Blackbird’s core innovation, Flynet, operates as a layer-three transaction protocol built upon Coinbase’s Base blockchain. This system enables diners to seamlessly pay for their meals through the Blackbird app and redeem loyalty points. The integration with Coinbase’s Base streamlines transactions and provides a secure, transparent platform for both restaurants and consumers.
But the question arises: is blockchain truly essential for this type of system? Competing platforms like Punchh, Toast, and lightspeed have achieved success using traditional financial infrastructures. Leventhal acknowledges this point, stating, I don’t think it necessarily ‘has to be built on blockchain.’ Visa’s network, more or less, was created using the same principles that we’re using for Flynet, and obviously they didn’t have blockchain.
Though, Leventhal argues that blockchain offers unique long-term advantages. There are a few things that we do believe that over time will be vital opportunities, and those opportunities will be based on being on-chain.
These opportunities include enhanced customer data ownership, where consumers will be able to continue to own that profile.
Furthermore, Blackbird envisions a future where restaurant customers become shareholders in the company, fostering a deeper sense of loyalty and shared success.
This vision aligns with the growing trend of decentralized ownership and community-driven business models, particularly popular among younger, tech-savvy consumers. Consider the example of fan-owned sports teams or community-supported agriculture (CSA) programs – these models demonstrate the power of shared ownership in building stronger relationships and fostering loyalty.
The Profitability Paradox in the Restaurant Industry
Leventhal, a seasoned entrepreneur in the restaurant tech space, is acutely aware of the challenges facing the industry. He points to data from the National Restaurant Association, highlighting the stark decline in average restaurant profitability from around 20% in the early 2000s to under 5% today. this decline is attributed to rising costs, changing consumer habits, and increased competition.
While social media platforms like Instagram and TikTok have fueled consumer interest in dining out, this increased visibility hasn’t translated into increased profitability for restaurants. In fact, the heightened price sensitivity among consumers and the looming threat of tariff hikes put even more pressure on already thin margins.
Leventhal summarizes this dilemma: There is a disconnect in the restaurant industry between the popularity and the intensity of consumer love for restaurants and ultimately the profitability of the industry.
This disconnect represents a significant chance for innovative solutions like Blackbird.
Blockchain as a Solution: A Matter of Outlook
Arianna simpson, a general partner at Andreessen Horowitz (a16z), believes that blockchain technology can play a crucial role in improving restaurant margins. The restaurant industry is made up of millions of local, small business owners around the world. Those restaurants are at the mercy of tech platforms that can charge a large, and often growing, percentage of a restaurant’s margin.
Simpson argues that Blackbird’s blockchain-based network offers a more equitable alternative,stating,Ben’s vision is for a network that is owned by the restaurants and the diners themselves,which is something that only blockchains enable.
She also highlights the immediate cost savings for restaurants using Blackbird, noting that they are already saving 3-4% in payment processing fees.
However, critics might argue that the complexities and volatility associated with blockchain technology could outweigh the potential benefits for many restaurants. Moreover, the learning curve for both restaurant staff and customers could be a barrier to adoption. Blackbird will need to address these concerns through user-kind interfaces, robust customer support, and clear interaction about the benefits of its platform.
Consider the recent struggles of companies attempting to integrate cryptocurrency payments – many have faced challenges due to price fluctuations,regulatory uncertainty,and lack of widespread consumer adoption. Blackbird will need to learn from these experiences and carefully navigate the evolving landscape of blockchain technology.
Blackbird Club: The Future of Restaurant Loyalty?
the launch of Blackbird Club, the company’s cross-restaurant loyalty program, represents a significant step towards building a more interconnected and rewarding dining experience. By allowing diners to earn and redeem points across multiple restaurants within the Blackbird network, the program encourages exploration and revelation, while also fostering loyalty to the overall Blackbird ecosystem.
This approach could be particularly appealing to frequent diners who enjoy trying new restaurants and cuisines. Imagine earning points at your favorite pizza place and then redeeming them for a discount at a trendy sushi bar – this adaptability could be a major draw for consumers.
Though, the success of Blackbird Club will depend on several factors, including the number and variety of restaurants participating in the program, the value of the rewards offered, and the ease of use of the Blackbird app. The company will need to carefully manage these elements to ensure that the program is both attractive to diners and sustainable for restaurants.
Looking Ahead: Blackbird’s Path to Success
Blackbird Labs stands at the forefront of a potential revolution in the restaurant industry. By leveraging blockchain technology to create a more equitable and engaging ecosystem for restaurants and diners, the company has the potential to disrupt traditional loyalty programs and payment systems.
However, the path to success is not without its challenges. Blackbird will need to navigate the complexities of blockchain technology, address concerns about user adoption, and prove the long-term value of its platform. If it can overcome these hurdles, Blackbird could become a major player in the future of dining.
