Interview with Satish Varma, Clorder

Story by Benjamin F. Kuo


For our startup interview this morning, we caught up with Satish Varma, co-founder of Torrance-based Clorder (, which is developing restaurant ordering software. Satish co-founded Clorder with Sridhar Sambangi, who was the Chief Architect of Cornerstone OnDemand. We caught up with Satish to learn more about the company and its products.

What is Clorder?

Satish Varm: Clorder is short for cloud ordering. We are an online ordering platform, that helps restaurants enhance their web presence and the profitability of their brand. Online ordering is obviously the core engine here, but we do lots of other applications and services around that, and provide a well rounded solution for running restaurants.

What's your background, and how did the company start?

Satish Varma : I have a bachelor's and master's in computer science and software, and went to Northwestern in Chicago, and got my MBA from Kellogg. I have been working on the business side of the product at Motorola, and worked there for over ten years. I was involved in the first color phone there which Motorola launched on Android.

I saw the highs and lows of the corporate world, so I decided to try to do something on my own. My first step was working at a startup, which launched Dell phones for Android, and after which I ended up in Chicago at Vcube Communications. We were a little early in that market, doing outsourcing, offshore, and managed crowdsourcing. That went okay for a year and a half, but I soon burnt out finally, and decided to move on.

My cofounder and I came up with this concept, and had been talking for awhole about how fragmented the overall market is for online ordering. We thought we found a gap in the market where we could fit in, so we looked at a bunch of the services which were existing in the market, and we designed our own product offering, back in 2012. We started our services in August of 2012. We started with just five, early adopters, and for the first year or so we were very low key, just working with those selected restaurants. That was on purpose, because neither of us had actually come from the food industry. My co-founder, Sridhar, actually was employee number 12 at Cornerstone OnDemand, and was Chief Architect when they went public. He had lots of cloud solutions background and architecture, and I managed the product and business side of it. Our early adopters were really about developing a minimum viable product, and we figured out, obviously, that there were a number of features customers were willing to pay for. So, we launched the company, and started getting revenues, which we've been feeding into overall product development. We spent our first year and a half learning how resturants operate, and fine tuning the product, and the next year we scaled out our solution and services offering. Right now, we are looking around 400 clients.

Are there any specific kinds of restaurants you are serving?

Satish Varma : Actually, because we are Indian, there are a lot of restaurants, 30 percent of our customers are Indian restaurants. But we also have Thai food, pizza joints, Cuban, Mediterranean, and all sorts of other kinds of restaurants. Size wise, they are mostly mom-and-pop shops, with around 20 percent being high end, premium restaurants. We have a number of customers with Johnny's New York Pizza, which is a franchise, and they have 8-10 locations in Los Angles, mostly helping them out in areas where their franchise does not. We have been building them marketing and collateral, tabletops, and everything in store as well as online.

How do restaurants pay for this?

Satish Varma : The way we structure it, we have two different revenue streams. One, is pay-for-performance, which is the transactional model. We charge a certain percentage of the order for orders that are placed through us. For managed services, we offer marketing services, including email marketing, social media, Google Adwords, and Facebook ads, which is a monthly recurring charge.

You mentioned you didn't have any background in the restaurant industry before--what have you learned since then?

Satish Varma : The first thing, is that every single restaurant is unique, like every single human is unique. There is a very large difference in the way that restaurants are run, unless they are a franchisee. So, that means you have to do a lot of customization on the product side, as well as with design and product integration, particularly with restaurant delivery services. We did not anticipate that in terms of what we needed to adapt our product to the market.

However, on the marketing side of this, we found that we could help restaurants build and sustain their business, in a more organic way, rather than more inorganic ways. We found out that sites like Eat24 and Grubhub are portals. Although they might send a lot of business to their partners, they don't share any of their contact information on their customers. They own the customer, and if they want, can send that customer to any other restaurant. That helps us, because what we are trying to do is the provide each of those individual restaurants a way to manage everything not in front of the customer. We are helping them with restaurant operations, and helping them manage technology. We've learned many things there, such as some restaurants, like Indian restaurants, don't do well at lunchtime, but they do well at dinner. That's because Indian food takes a lot of time to prepare, and people don't have time during lunch to wait, and they don't want to sit that long. For Thai restaurants, we have to create a different kind of platform, because their order size is usually small compared to other restaurants. These are all the nuances we needed to learn to create the right marketing package for restaurants, to set the right frequency of emails, when to post social media, and so on.

Finally, there are lot of people trying to tackle restaurant ordering--what makes you different?

Satish Varma : We think we have figured out market product fit, because our attrition rate is less than 1 percent in the last three years. I think that is mainly because of the rapport and relationship we have with our restaurant owners. We are completely transparent on what we are doing, we try to educate them on what is really going on behind the scenes, and because of that they really love us. Just this morning, a restaurant was having a meeting with one of our strongest competitors in this city, who was trying to push their product on them, and so the owner called us into the meeting. That happens quite frequently. To make a long story short, it's all about the relationships that we build, building loyalty and a client list. Also, I think it's because we are building their brand, and we are working in the background. We're not an aggregator pushing our face in front of customers. Instead, we are putting the restaurant in front of the customer, and helping them to build their own online presence, and helping them to make their own online footprint larger.



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