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Brands often rely on web browsing and social media monitoring to understand what customers are saying about them and gain insights for product development. Cafeteria is a startup that wants to connect brands with their most opinionated customers: teens.
The startup is launching an iOS app today to onboard teens and connect them with brands they’re interested in to provide feedback on their strategy and product development. In return, teens can earn money for their comments. Before its launch today, the startup tested the app under a three-month pilot program, onboarding teens in 60 US cities.
The cafeteria is headed by CEO Rishi Malhotra, who was the co-founder of India-based music streaming service Saavn (now JioSaavn) — which was acquired by Mukesh Ambani’s Reliance Jio in 2019 — and former CEO of Luminary Podcasts. The founding team also includes chief business officer Mark Silverstein, who was chief content officer at Luminary, and chief design officer Leeann Sheely, who was VP of design at Luminary and JioSaavn.
The company has raised $3 million, led by Collaborative Fund and Imaginary Ventures, with additional participation from Bertelsmann and veteran music industry executive Guy Oseary, who has worked with Madonna and the Red Hot Chili Peppers.
“Cafeteria is in the business of consumer insights and market research, with a unique focus on real, authentic feedback from teens. It features nonpartisan data collection, customizable analytics, and strong leadership,” Andrew Montgomery, partner at Collaborative Fund, told TechCrunch via email. Under the leadership of CEO Rishi Malhotra, it provides brands with actionable and timely insights tailored to the tween generation.”
Montgomery added that Cafeteria has a great product market fit for the consumer insights market because it provides authentic, actionable insights to brands directly from teens.
How does the app work?
Once a teen joins the app, they will choose the brands they are interested in. The cafeteria will then invite them to participate in surveys called tabulations. Teens can provide answers to questions in a table through text or voice message.
Teens will get paid between $5-$20 for their ideas, and can transfer their balance to Venmo, PayPal, Cash App and bank account through the cafeteria’s integration with Dots, a payments API. Users will have to have at least $10 in their Cafeteria wallet to transfer the balance.
These backgammon sessions last an average of five minutes, the company said. Cafeteria reported that teens offer insights ranging from which celebrities Nike should work with — apparently, Adam Sandler is as popular as Taylor Swift and Sabrina Carpenter — and how they would spend $100 at a mall.
Cafeteria currently has thousands of users who access the app either through referral or word of mouth. All users are placed on a waiting list before being accepted.
During onboarding, teens go through a lifestyle table, where they are asked 20-25 questions about retail, shoes, food, music, first car, banking, and more. Post that they can choose eight brands they like.
The company is also limiting the number of surveys or schedules teens get per month to three to five. Malhotra believes this activity for teens is more beneficial than browsing social media, but the company doesn’t want them to become daily or weekly active users.
Privacy and security
The cafeteria noted that all user identity markets, such as names and email addresses, are hidden from companies. Brands can only see gender, age and zip code.
For users under the age of 18, the company has an optional feature to include parental emails while signing up for the service, but it is not enforced.
The startup has a moderation policy consisting of humans and artificial intelligence. It monitors comments containing misinformation and harmful content, and flags users if they find such input.
In its privacy policy, the startup indicates that the services are not intended for use by children under the age of 14, and if the company becomes aware of any underage users, it deletes the data.
How do brands benefit from it?
The Cafeteria collects ideas from teens and puts them in a dashboard called albums by organizing them by categories. These albums contain insights with titles like “Edikted, Zara, Adidas and Skims are thriving as brands teen girls want to try next” and “On average, teens say $314 is what they would pay to see their favorite artist.”
The startup has a basic plan of $5,000 per month to access lifestyle album insights as well as competitor insights. $8,000 per month allows them to create two surveys or tables with at least eight questions across at least eight users. For additional surveys, brands need to pay $2,500 per month.
Malhotra said the cafeteria featured top brands in its initial phase, but did not mention which ones. He stated that the company has completed more than 2,200 tables containing more than 50,000 ideas.
The company believes its core strength lies in collecting unstructured data and creating insights from it.
“We’re building big language models that put insights data into context. We’re training different models that help us make sense of a lot of data,” Malhotra said.
The cafeteria believes that in the future, it can make the brand engage better with teens and also offer store credit or a percentage discount.
The company is also building the ability for brands to run claims against Insights albums and look at different metrics.
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