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January 5, 2012 at 6:00 AM

“Rail” restaurant payment system debuts

A new payment system that lets restaurant customers handle credit card payments at their table is being announced today by Kirkland startup Viableware.

Called Rail, the system looks like a regular restaurant bill folder but inside is a wireless device with a card reader and color display.

The company’s executive team includes startup veterans Joe Snell and Andrew Pope, former Restaurants Unlimited Chief Executive Steve Stoddard and Bob McBreen, a founding member of Microsoft’s Xbox team.

Snell, the chief executive, expects the system to be used in 20,000 restaurants across the country within a few years. He said the company is in talks with major vendors of restaurant retail systems, which may sell and distribute Rail.

Thumbnail image for RailImage.png

A number of companies are offering devices and applications for collecting payments on mobile devices such as smartphones and iPads, but Viableware is positioned as a high-security, enterprise product. The Rail devices are also more economical and durable — able to withstand falls, spilled beverages or ketchup smears, Snell said.

The company’s software lets customers split bills up to nine ways, or pay for individual items on a shared tab. Then they swipe their card, sign on the screen and have their receipt emailed or printed out in the restaurant.

Viableware’s pitch is that the system is far safer for customers because they never hand over their credit card, preventing theft by card “skimming.”

Split Tip Page.png

For restaurants, the system is pitched as a more efficient way to handle payments. Instead of servers going back and forth with checks and payments they drop off the Rail devices and move them from table to table as needed.

The system uses a secure Wi-Fi system that connects to restaurant point-of-sale systems, and resets between usages when the cover is opened and closed.

A large restaurant would be charged a flat $450 per month for the system, including the Rail devices and Wi-Fi routers. They would pay additional monthly fees for extra apps, such as customer surveys, coupon programs or a taxi hailing program.

Viableware also plans to make money from sponsorships on the opening screen, a banner under the display and Groupon-style deal offered at the end of the checkout process.

Viableware hs been testing the system at the Boom Noodle restaurant at University Village for about three weeks and is preparing to start a higher-profile, beta test at Boom and an Anthony’s restaurant. (It had planned to start at the Kirkland Anthony’s HomePort but that location has an older payment system that needs to be upgraded first, Snell said.)

Viableware, which has 12 employees, raised $1 million last summer and is raising $3 million more.

In the meantime the company is going to use the beta test in the Seattle area to improve the system, which had a lag in response time during a demo Wednesday. It’s also continuing to develop apps beyond the 80 it has already created.

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