a new business modelEat.fi, a Finnish website that focuses on restaurant search and reviews, finally rolls out its business model after building the high quality site and community for three years. The company, quite predictably, has chosen to let the restaurant owners advertise their lunch time specials and other offers.

Even though you could argue that is has taken way too long for the founder Tina Aspiala to monetize the site, it might have been worth the wait. Eat.fi is one of the only Finnish sites that I use regularly when checking out new restaurants and especially while making lunch and dinner meetings. To get an idea of the popularity of the site, Eat.fi iPhone app topped the Finnish App Store and boasts currently about 12,000 downloads (and 2,000 Ovi Store downloads).

I believe that the advertising business model will work great for the advertisers as well as the company itself. The only question that remains is will it scale to make Eat.fi a significant business.

As soon as the company has nailed the business model, its time to raise some capital and expand the restaurant site abroad. Given the strong foothold that for example Yelp has in US, Eat.fi needs to consider markets closer to home. The Nordic countries a likely target for expansion, even though there are emerging some restaurant search and review sites like Ted Valentin’s Restaurangkartan in Sweden (although even that is still in the making).

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I can also see Eat.fi to be an ideal acquisition for a bigger media house, since it has one of the most loyal high quality communities that I have seen a site to have. Tina has made extra efforts to make the site extra easy to use and clean all the comments from the reviews that don’t add any value for users. This goes a long way to explain, why no big commercial player can’t just create their own site to compete with Eat.fi. They just don’t have the patience or know how to put skin in the game in building a great online community. You can get an idea of how much such love and care that has gone into Eat.fi’s user interface and overall user experience matter by looking at the graph (on the right) that shows how the number of reviews shot up after the team realized their new User Interface at the end of the 2008.

We eagerly wait to see how Eat.fi fares when it will expand abroad with its new model. That is, if someone won’t acquire the nifty site first.

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