Revel Systems, a startup building point-of-sale software and hardware that works with the iPad, has raised $10.1 million and added two people to its board.
The funding comes from the two new directors: Tim Tighe, a former CEO of Hungry Jack’s (a Burger King franchisee in Australia), and Sean Tomlinson, an entrepreneur. The funds will be used in part to help increase Revel’s headcount in its San Francisco headquarters by 50%, as well as construction of a new distribution center for its hardware on the west coast.
Revel, which had previously raised $3.7 million, is part of a growing list of companies using the iPad in ways far beyond what Apple originally envisioned. By attaching hardware such as a credit card reader, a receipt printer and a cash drawer, the tablet is becoming a key piece of commercial infrastructure for many small businesses.
Revel isn’t at a loss for competition. Among their biggest competitors are Ebay's Paypal Groupon, NCR Intuit and ShopKeep.
There’s also Square, a darling of small businesses that says more than 300,000 use its services to charge customers. Square says it is processing more than $15 billion in payments annually–besides its partnership with Starbucks--and is being used at 30,000 retail locations.
By comparison, Revel said it is pulling in $9 million in annualized revenue, and is growing at 380% annually, with more than 1,200 stores, restaurants and other locations using its system. It now processes about $33 million in payments per month.
But Revel points to a distinction: it is focusing on larger companies, with advanced inventory and other needs such as order and pickup lines, which require the point-of-sale systems to talk to one another.
“We have all the analytics and all the features companies need to run their businesses,” said Lisa Falzone, Revel’s co-founder and chief executive. Additionally, she noted, the system is designed to replace bulky old cash registers retailers have been using for decades.
The really large chains “are really stuck in Windows,” she said, referring to some retailers’ computer systems that rely on Microsoft's ubiquitous software that powers a majority of the world’s computers. Using tablets and specialized software is more efficient, she says, and companies are realizing that. “It’s just a matter of time.”
David Robertson, publisher of payment industry trade journal The Nilson Report, said there is opportunity to attract merchants using outdated card-swiping machines.
“Those terminals are in many ways like dead men walking,” he said. Powerful tablet software, reliable wireless networks and advanced cloud services will likely spur that change, he added.
But, he said, it’s likely Revel and other smaller companies will be acquired by their larger rivals or they’ll consolidate with competitors.
In the meantime, Revel is looking toward international expansion. Mr. Tighe, Revel’s new board member, said in a statement that he expects to help with the company’s overseas work in particular.
“This company is making huge strides for revolutionizing point-of-sale as we know it, and I’m looking forward to being a part of that,” he said.