Why Owner cofounder and CEO Adam Guild is serving up software especially for mom-and-pop restaurants

When I met Adam Guild, Owner CEO and cofounder, at San Carlos restaurant The Toss, it was immediately clear he’d been there before.

“Our cofounder and CTO jokes that this is his new office,” Guild told me. “He’s basically got a sublease! He brings his laptop here during the day and works right next to the register—so he can see people coming in, ask if they’ve used our platform, and interview them to figure out where the friction is.”

When Guild and I met in March, The Toss had just recently started using Owner’s software, a platform built to manage the digital presence of mom-and-pop restaurants. Tracy Everett, owner and operator at The Toss, gave it a positive review: “It’s going super, super well,” she told me. “There have been little growing pains, moments of fear, but they’ve really been on-call.”

And over a (sublime) chicken pesto panini, Guild helped me dissect what the opportunity for a restaurant tech company actually looks like from his perspective. The essence of Guild’s case is this: That restaurants are perhaps a relatively underserved market to begin with, but that the most meaningful opportunity lies in delivering value for a specific kind of restaurant owner—the mom-and-pops.

“The technology that Sweetgreen and Cava both use to power their online ordering system is a company that won’t even touch any customer that has less than 50 locations, because they’ve identified that it’s so much harder to serve small businesses, even those with 10 locations,” said Guild. “At Owner, we’ve geared our entire model towards helping small business owners.”

And most restaurants are, well, pretty small parts of a really large, really fragmented marketplace. There are about 749,000 restaurants in the United States, and nine out of every ten have less than 50 employees, according to the National Restaurant Association. That first number is smaller than it used to be since there were more than one billion restaurants before COVID-19—a reality that highlights just how precarious being a restaurant owner can be.

“The restaurant and food service industry is forecast to reach $1 trillion sales in 2024, and nationally mom-and-pop restaurants encompass 40% of the restaurant industry,” Masha Bucher, founder and general partner at Day One Ventures, said via email. “Owner's the largest investment of our current fund and I think we struck gold.”

Other Owner investors include Redpoint, Altman Capital, and SaaStr Fund, and the company is part of a sprawling category broadly termed as restaurant tech. It’s a category with a lot of subcategories, Mark Mullen, Bonfire Ventures cofounder and managing director explained to me: "There's software solutions, there's delivery solutions, there's robot solutions, and so on.”

"Restaurant tech is really everything that a restaurant touches,” said PitchBook analyst Alex Frederick. “So, that could be back office, management software, or loyalty programs. It could be Wi-Fi offerings for consumers in the restaurant and could be also inclusive of third-party delivery."

At the center of the space seems to lie an old truth: That the restaurant business is a tough business.

"The biggest problem for restaurants is food costs and employee costs,” said Mullen, an early investor in ChowNow (and, fun fact, whose dad was the CEO of more than one restaurant chain). “In California, it’s going to $20 an hour, right? And with all that cost increase, they’re going to try to push it up to the customer, but, eventually, those customers are going to revolt…You can’t just keep raising costs, raising prices forever, so I hope there’s tech that tries to improve the margins.”

Funding-wise, this isn’t exactly a booming category right now, said Frederick, who notes that funding to restaurant tech companies has decreased significantly over the past two years, with funding for third-party restaurant delivery especially hard hit.

But what remains is this: A big market, with big problems to solve. Which brings us back to the umbrella-ed table at The Toss in San Mateo with Owner CEO Guild, who seems to truly and existentially love local restaurants.

"A world drained of these local restaurants is a world drained of color, where suddenly every neighborhood begins to look and feel exactly the same,” he said.

Which, a month and a half later, begs the question: How is The Toss doing with Owner’s software now? I cold-called the restaurant and soon found Everett, and she told me over the phone:

“The story’s not over, but we’re delighted so far.”

ICYMI...CoreWeave, an AI cloud computing startup, raised a $1.1 billion round of funding at a $19 billion valuation. More from my colleague Sharon Goldman here.

See you tomorrow,

Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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Correction: The email version of this article inaccurately stated that The Toss is in San Mateo. It is in San Carlos.

This story was originally featured on Fortune.com