In this episode of Software Spotlight, host Michael Bernzweig interviews Geoffrey Toffetti, CEO of FPG, discussing his journey in the hospitality industry and the innovative solutions FPG provides to enhance guest experiences and maximize revenue for hotels. Geoffrey shares insights on the challenges faced by the hospitality sector, the importance of effective onboarding and implementation of their software, and the strategies for client success. The conversation highlights FPG's niche expertise and the referral-based approach to client acquisition, emphasizing the significant impact of their solutions on the hospitality market. In this conversation, Michael Bernzweig and Geoffrey Toffetti discuss the integration of technology in the hospitality industry, focusing on the importance of the front desk and food and beverage sectors. They explore acquisition strategies, the challenges of a fragmented ecosystem, and the potential of AI to enhance customer experiences while maintaining human interaction. The discussion emphasizes the need for businesses to adapt to technological advancements and the importance of nurturing relationships within communities.
In this episode of Software Spotlight, host Michael Bernzweig of Software Oasis interviews Geoffrey Toffetti, CEO of FPG, discussing his journey in the hospitality industry and the innovative solutions FPG provides to enhance guest experiences and maximize revenue for hotels. Geoffrey shares insights on the challenges faced by the hospitality sector, the importance of effective onboarding and implementation of their software, and the strategies for client success. The conversation highlights FPG's niche expertise and the referral-based approach to client acquisition, emphasizing the significant impact of their solutions on the hospitality market. In this conversation, Michael Bernzweig and Geoffrey Toffetti discuss the integration of technology in the hospitality industry, focusing on the importance of the front desk and food and beverage sectors. They explore acquisition strategies, the challenges of a fragmented ecosystem, and the potential of AI to enhance customer experiences while maintaining human interaction. The discussion emphasizes the need for businesses to adapt to technological advancements and the importance of nurturing relationships within communities.
Takeaways
Sound Bites
Chapters
Michael Bernzweig (00:01.634)
Are you ready to unlock the secrets of B2B SaaS success? Tired of sifting through endless noise to find actionable insights that actually move the needle?
Welcome to Software Spotlight, your weekly deep dive into the transformative world of Software-as-a-Service. Your host is Michael Bernzweig, who in 1998 launched Software Oasis as one of the first platforms enabling businesses to download, license, and deploy software instantly across their networks with a single click. Today, Software Oasis has evolved into one of the leading communities where businesses find top tech consultants across the USA and Canada.
Each week, Michael sits down with industry titans, innovative leaders, and game-changing executives to bring you exclusive insights you won't find anywhere else. From emerging technologies to market trends, Software Spotlight delivers the strategic intelligence you need to accelerate your SaaS career and stay ahead of the curve.
Join our growing community of tech professionals and decision-makers. Subscribe now on your favorite podcast platform and visit softwareoasis.com/subscribe to get our bi-weekly newsletter delivered straight to your inbox.
Get ready for weekly data, trends, analysis, interviews, and insights that will propel your B2B SaaS career forward.
Subscribe to our bi-weekly newsletter https://softwareoasis.com/subscribe/ to stay updated with more insights from technology leaders and transformation experts.
Connect with an exclusive audience of consulting organizations, B2B SaaS founders, and tech leaders through Software Oasis. For over two decades, we've been the trusted platform for professionals seeking smart solutions. Now, leverage our highly engaged community with targeted advertising options designed to maximize your brand's impact and drive real results. View advertising options https://experts.softwareoasis.com/ads
Are you ready to unlock the secrets of B2B SaaS success? Tired of sifting through endless noise to find actionable insights that actually move the needle?
Welcome to Software Spotlight, your weekly deep dive into the transformative world of Software-as-a-Service. Your host is Michael Bernzweig, who in 1998 launched Software Oasis as one of the first platforms enabling businesses to download, license, and deploy software instantly across their networks with a single click. Today, Software Oasis has evolved into one of the leading communities where businesses find top tech consultants across the USA and Canada.
Each week, Michael sits down with industry titans, innovative leaders, and game-changing executives to bring you exclusive insights you won't find anywhere else. From emerging technologies to market trends, Software Spotlight delivers the strategic intelligence you need to accelerate your SaaS career and stay ahead of the curve.
Join our growing community of tech professionals and decision-makers. Subscribe now on your favorite podcast platform and visit softwareoasis.com/subscribe to get our bi-weekly newsletter delivered straight to your inbox.
Get ready for weekly data, trends, analysis, interviews, and insights that will propel your B2B SaaS career forward.
Subscribe to our bi-weekly newsletter https://softwareoasis.com/subscribe/ to stay updated with more insights from technology leaders and transformation experts.
Connect with an exclusive audience of consulting organizations, B2B SaaS founders, and tech leaders through Software Oasis. For over two decades, we've been the trusted platform for professionals seeking smart solutions. Now, leverage our highly engaged community with targeted advertising options designed to maximize your brand's impact and drive real results. View advertising options https://experts.softwareoasis.com/ads
I'd like to welcome everyone to this week's edition of the Software Spotlight. I'm your host, Michael Bernzweig, the founder of Software Oasis. And this week, we're fortunate to be joined live by Geoffrey Toffetti. He's the CEO of FPG and the creator of IN-Gauge. So, Geoffrey, I'd like to welcome you to the podcast and kind of get started.
Geoffrey Toffetti (00:29.016)
Thank you, it's great to be with you. Appreciate it.
Michael Bernzweig (00:30.722)
Yeah, no, wonderful. And I can tell from some of the questions that have already come in from the audience that there are a lot of people in the hospitality space excited to hear our conversations. So yeah, now this is really fun. So maybe, you know, if we could start with this, if for anybody that may not be familiar with either yourself or FPGA, could you just share with us your journey?
Geoffrey Toffetti (00:43.755)
Excellent.
Michael Bernzweig (00:59.352)
getting to where you are and what's going on over there at FPGA.
Geoffrey Toffetti (01:03.406)
Yeah, that'd be great. So my career, you know, beyond the hourly jobs you have when you're a kid, my career started in hospitality. I started as a valet at a beach resort, worked my way up over several years to get to director of guest services. And then a colleague of mine left and moved to Orlando, which is where I am now. And the company he was working for was starting another company. So they recruited me to join just because I had a kind of service background, ops background.
And I was with that company for 11 years. was the, pre revenue. was the first employee they hired. And when I exited, there was, you know, over 600 employees and we were doing billions in revenue and working globally. And because we sold it, the options that I had matured and, you know, was sort of able to think outside of that company. And for the first time in a decade, and I met the founder of FPG at that time, Ziad Khoury.
And it was a very small company, but had a very, very cool value proposition. And because I had just helped grow zero chaos from nothing to, you know, hundreds of millions of dollars in enterprise value. I was like, I could do this. We could do this. I could take this company up and build it, build it up again. and the value proposition was they helped companies generate, greater guest satisfaction and greater revenue at the point of sale. hence the name frontline performance group.
And, and with my hospitality background, he wasn't working in hospitality. So I was like, this is the next vertical we're going to go after hospitality. And now we're at, you know, almost 2,500 hotels and 110 countries and, and even have adjusted from pre COVID being a services consulting training business to fully SAS. and, know, tip that three decades of experience that Zia and team had accumulated and, and brought it to hospitality.
And then took all of that and codified it into the software that we call IN-Gauge, which is really the entire toolkit you need to run a world-class point of sale sales organization.
Michael Bernzweig (03:10.102)
I love it and it would be an understatement to say that the total addressable market is nothing other than huge.
Geoffrey Toffetti (03:18.286)
Yeah, trillions, but we tend to call it somewhere circa like 10 to 15 billion is our direct addressable market. But you could say anywhere that revenue is flowing across a desk or on the phone is theoretically an addressable market for what we do.
Michael Bernzweig (03:35.342)
So, you know, I guess at the end of the day that the biggest question that comes to mind, as far as the value proposition that you're providing to, you know, anyone in the industry, what is the biggest area that you're helping them tackle? Like, what is the biggest challenge that organizations are facing that the solution is helping them with?
Geoffrey Toffetti (04:03.01)
Yeah, it's really going to be about revenue and guest experience, but it's way to kind of conceptualize it. For a hotel, as example, when you book a hotel, you tend to book it in advance and then you arrive at the hotel. And so they know how much you've booked in revenue and they know what room you booked. But that might not be the best room for you. And it might not be the best room or the best view available.
Um, so that you need the front desk to educate the guest on what is available that would enhance their experience and then charge them for it. And, often what happens in the absence of someone like us, the front desk agents will just give it away. Uh, or they'll just not offer at all. They'll just ignore it because they haven't been trained. So what we bring is, a combination of the expertise in how to sell in a transactional environment. Cause we've been doing that for 32 years. Um,
the toolkit to be able to measure whether it's happening and the quality with which it's happening, and also the training. So you don't have to try to understand how to train your front desk agents in this case, you can just use us and our digital training will take care of all of that. So it's.
Michael Bernzweig (05:13.284)
So you've really automated and structured the entire process.
Geoffrey Toffetti (05:17.73)
Yes, the only thing we don't automate is the front desk agent speaking to the guest, but we train them how to do it. So there's no mystery to it.
Michael Bernzweig (05:24.216)
I it.
And are there certain organizations that see the most value from what you're providing versus others that may not see that full impact?
Geoffrey Toffetti (05:37.484)
Definitely. Just by way of recap for the hospitality marketplace, in case anyone doesn't know, it's really three constituent organization types that are involved. You have the brand, which is what everyone assumes is hospitality, which would be Hilton, Marriott, Wyndham. Those are the brands. Then you have management companies who manage the asset and actually run the hotel on a day-to-day basis. And then you have the owners who own the hotel. And sometimes they're the same group.
But most of the time there are three different parties involved in every hotel. So the adoption of the program and the rigor with which they implement it varies from group to group. But there are groups out there that are realizing hundreds of millions of dollars a year in this incremental revenue. And that revenue is also the highest margin revenue because it's on top of what they already booked. So there's very little incremental cost to changing you from a room that looks at the street to a room that looks at the beach.
Michael Bernzweig (06:10.414)
Sure.
Geoffrey Toffetti (06:35.958)
it's the same cost structure. the margin is extremely high on this revenue. So there are organizations that have been with us longer and they're more mature and they're generating more. And then there's others that just started with us and they're not developed. They're not generating as much, but the results are almost immediate. Once we implement within the first 30, 45 days, they're going to see an uptick in this revenue. And it's, it's an amazing experience when a client's eyes open to what is actually possible. Cause they,
There is some skepticism. I'll go in and talk to a, we'll go talk to a hotel company. We'll say, you could, you can generate 5 % rev part at the front desk. And they're like, no, we can't. And then when they do, they're like, is, can we do seven? You know, can we do eight? yeah.
Michael Bernzweig (07:16.76)
Yeah. So what I'm hearing is you're able to help them maximize the revenue for the existing assets that they have.
Geoffrey Toffetti (07:28.056)
Correct. It's the same employees, the same guests, more revenue. So it's extracting more revenue from the guests you already have.
Michael Bernzweig (07:36.068)
Who the heck could say no to that in any industry?
Geoffrey Toffetti (07:39.114)
You'd be surprised that you dare. We still read. We still receive objections, which is bizarre because it's like our ROI is like 25 to one on average. So what you're paying us, you're going to make, you know, 25 times that, but they still there's, I think it comes down to people that have been in the industry for a long time and don't know this stuff. It's almost like a, a challenge to their ego to say that there's, there's another million dollars in your hotel that you were never aware of.
Michael Bernzweig (07:44.291)
Yeah.
Michael Bernzweig (08:03.257)
Yeah.
Michael Bernzweig (08:07.222)
Yeah, no, I got you.
Geoffrey Toffetti (08:09.272)
But now it's getting to be more institutional, so it's getting easier to convince people.
Michael Bernzweig (08:14.062)
So I would have to imagine in what you're doing that the most important component to successfully launching within an organization is the onboarding and the implementation, right? Yeah, so.
Geoffrey Toffetti (08:28.366)
100 % yes, that is the holy grail for I think for any software that requires usage by individuals Because there's obviously the software that's utilitarian it just runs But if you need people to interact with it, it's it's absolutely the first 30 days that are gonna make or break that
Michael Bernzweig (08:33.849)
Yeah.
Michael Bernzweig (08:44.79)
So at the end of the day, you mentioned three different constituents that all have their hand in the pie. And then you have obviously different functional units within the actual hotel. And you need to have everybody on board. So what is the right way to get there? mean, I've...
Geoffrey Toffetti (08:51.196)
Yeah.
Michael Bernzweig (09:08.812)
always you've often heard the adage the easiest way to eat an elephant is one bite at a time. how do you get there with this massive, massive challenge?
Geoffrey Toffetti (09:15.822)
Correct.
Geoffrey Toffetti (09:20.876)
Yeah, so we we've gotten pretty good at at the launch process. So we do, we actually still do instructor led virtual training at the very beginning because it's critically important of a human being interacting in the beginning to get them excited about it and to get them to see the vision. But yeah, we'll, we'll schedule it by department. So if we're rolling out multiple departments, we'll roll them out in succession. I'm not trying to have restaurant employees in training with front desk agents. So
Michael Bernzweig (09:48.43)
Right.
Geoffrey Toffetti (09:48.524)
We partition it out and we'll publish a schedule of available times. we actually had an instance where we implemented several hundred hotels in one month. And it's all enabled by doing it virtually. It's very much like what we're doing right here. And we have people that are on camera most of the time every day doing these launch trainings. And so the training is short, it's quick. We can run through several iterations of it in a day to handle for shifts and things like that.
Michael Bernzweig (10:03.246)
Sure.
Geoffrey Toffetti (10:16.238)
And then it's backed up immediately by digital learning through our learning management system. So as soon as they come out of the, we call it a power up, just raising the power level on the team. And then they can go right into digital learning and that's available on the mobile app or on the web app.
Michael Bernzweig (10:31.182)
So the phases are obviously at initial onboarding, but then after that, are there other phases that a client would go through to help them maximize what they're seeing in the solution?
Geoffrey Toffetti (10:46.284)
Yeah, we actually give them what we call the foundation framework. It's everything they need to do to get the most value out of the program. And it's very direct and very simple language. It's not complicated. And we assign them to a client success consultant that supports them virtually. We designate someone in each touch point location, a champion. That champion is basically the person responsible for the incremental revenue. So the champion is paired up with a
Michael Bernzweig (11:01.667)
Okay.
Geoffrey Toffetti (11:13.528)
client success consultant that they're available to them whenever they want. But there's a kind of a structured cadence of communication throughout the year, to make sure that they're staying up on the framework and that as they mature as a, as a program, they get more and more advanced in their thinking. Cause there there's day one is, you know, get your front desk agents to offer day 90 is take them on room tours and, break down dialogue for them. So they understand better how to do it. Day.
nine months could be what other things on the hotel is the front desk able to sell? How do you bring those other things into play? So there's a progression toward greatness, and they're supported by a CSE throughout the journey.
Michael Bernzweig (11:58.338)
I love it. So it brings up so many other questions, but I'm just gonna ask you two that came to mind. So at the beginning of the podcast, you mentioned the number of hotels that are on the platform. Is that individual hotels like Marriott might be an organization that might have thousand individual locations or is it actual locations or can you kind of clarify that a little bit?
Geoffrey Toffetti (12:27.522)
Yeah, it's 2500 ish actual hotel buildings like locations. It's probably 150 clients if you want to think about the organizational side of it by about 150.
Michael Bernzweig (12:32.004)
Got it.
Michael Bernzweig (12:36.164)
I love it.
Michael Bernzweig (12:40.6)
So if I understand right, I mean, you were really a niche subject matter expert within this space. That is what FPGA is. Yeah.
Geoffrey Toffetti (12:48.206)
Oh, definitely, definitely. And we acquired our only two real competitors, company called Drake Beale and Associates back in 2015. And we actually did an acquisition during COVID, which was risky, but fortunate we could do it. We bought TSA Solutions out of Singapore, which was our biggest competitor. So we've really bought up all the IP, all the companies that know how to increase transactional sales volume.
Michael Bernzweig (13:08.961)
Mm-hmm.
Geoffrey Toffetti (13:15.842)
We basically acquired them in the hotel space. So yeah, we're, we're deep experts in a niche. and, and, and now the software, has made us infinitely scalable in our model pre COVID where we had consultants actually visiting the hotels on a regular basis. Like every month they'd go in for two or three days and they train and coach. And so you can imagine we spent hundreds of thousands of hours on the ground in hotels behind the desk or in the restaurant.
Michael Bernzweig (13:21.473)
I love it.
Geoffrey Toffetti (13:42.978)
we acquired a ton of practical knowledge, which then we were able to build into the software. So the tools in the software that, I mean, some stuff is obvious like analytics and reporting, but there's other things that aren't as obvious like recognition and peer to peer learning. And all that stuff is all, everything we've ever learned about how to get an hourly employee to sell is in this platform.
Michael Bernzweig (14:06.318)
I love it. So, and obviously when a client comes aboard, you've made them in their market, just that much more competitive, profitable and efficient. So I would think that, you know, over time,
you know, some of their competitors may find out about you as the magic sauce that's helping out their competitors. So are most of your new clients coming through referrals or where are your clients coming from?
Geoffrey Toffetti (14:40.014)
Yeah, we're, we are definitely a relationship selling organization. We, believe in referrals. It's a network effect, particularly in hotels, because if, if you look at the global hotel marketplace, you're probably looking at three or 4,000 organizations that comprise the vast majority. So it's not a huge market. mean, it's a huge market in hotels, but the decision maker market is pretty small. So it's, it doesn't make sense to have 200 salespeople out canvassing because you're, you're only dealing, you're, you're, it's more surgical.
Michael Bernzweig (15:02.51)
Yeah.
Geoffrey Toffetti (15:09.89)
than that. the referral thing is enables that surgery to occur. But yeah, there was a funny story when we were just getting started in hotels, we were huge in car rental before I arrived. That was the whole business. So we had this niche expert thing going on in car rental, but in hotels, we're we're brand new. And when we got to a certain point, I had a sponsor in one of the major brands who was, you know, rolling us out and helping us grow.
Michael Bernzweig (15:09.933)
Yeah, so
Geoffrey Toffetti (15:36.11)
And we ended up working with a competitor across the street from his, one of his flagship hotels. And he called me and he's like, you know, you guys are my secret weapon on ADR and I'm not sure I want you working across the street. And I said, but listen, I don't originate your customers. The tide rises all boats. So if their rate goes up, then you can raise your rates and you raise your rates. can raise their rates. he, he, he paused for a second. said, forget I called.
Michael Bernzweig (15:50.02)
Yeah.
Yeah.
Michael Bernzweig (16:00.281)
Yeah.
Michael Bernzweig (16:05.115)
Well, you know the interesting thing and I mean you shared you know, there's about 3,000
Geoffrey Toffetti (16:05.408)
It's never been an issue since.
Michael Bernzweig (16:12.724)
Ideal clients for what you're offering you've got a hundred and fifty so you're five percent of the way there So your your opportunity is is huge and a very defined You know ideal client so really you have have you were cut out for you, but you know, you know where you're you're heading towards
Geoffrey Toffetti (16:21.614)
Mm-hmm.
Geoffrey Toffetti (16:33.154)
Yeah, we've identified, think, I'll say 90 % of every decision maker in the world that we need to meet. So now it's a matter of deliberately and in an organized way moving through our networks to get to all of those people, you know, by referral.
Michael Bernzweig (16:40.471)
Yeah.
Michael Bernzweig (16:50.912)
And the interesting thing, for anyone that's in the SaaS space or even in the consulting space, that is exactly what Software Oasis is, is a community of organizations that are referring clients to one another. And at the end of the day, if you've ever sat in a doctor's office and you've watched a pharmaceutical sales rep trying to get an appointment with a doctor, you know it's not gonna happen.
Geoffrey Toffetti (17:19.246)
That's not the way to do it.
Michael Bernzweig (17:20.806)
And what we found is that at the end of the day, a referral is absolutely your best way in the front door. So that's the challenge that we're solving at Software Oasis, but it really is interesting. it's the magic sauce that helps everybody get to that next space. So the other question that comes to mind, you mentioned that there's a lot of functional areas within each
Geoffrey Toffetti (17:30.167)
Agreed.
Geoffrey Toffetti (17:41.838)
That's right.
Michael Bernzweig (17:51.254)
individual hotel. For a hotel that has every area that's integrating your solution, what are those areas?
Geoffrey Toffetti (18:01.644)
Yeah, so right now we're focused primarily on two, the front desk and food and beverage. The other touch points will support them, but they're very small in comparison to the impact of the front desk and the restaurants on the business. So for instance, if you have a resort that obviously has a front desk, but they have multitude of restaurants, they have banquets and conventions, they have a spa, they have retail stores. The retail stores and spa as a relative
percentage compared to what you can do in the restaurants and the front desk is very small. So our strategic focus is front desk and food and beverage. We think those are the two pillars that are going to drive the most incremental revenue and value. And they do. I mean, it can be, we have hotels that are making, you know, $8 million a year in our program, in one hotel, which is a lot of money. When you're a hotel owner, to get $8 million, you'd have to build three restaurants.
But if you implement our program and you implement it seriously, you can get that with no overhead, no capital investment and do it at 80 % margin.
Michael Bernzweig (19:06.52)
Yeah, and it's so funny because I see so many, even though we're in completely different spaces, I hear so many different parallels because at the end of the day, our community is both a community and a platform. And it's amazing. And it's like I say to my teenagers, I have two teenagers that I say to them, know, half of life is showing up and the other half is what you do when you get there. And, you know, we'll have organizations join the community and...
And they sign up and they think referrals are going to just start showing up on their doorstep and nothing happens. And they say this, this, this darn thing doesn't work. And then we have other organizations that join and they jump in with both feet. They get active in everything going on in the community. They start to meet other organizations and it's like any, anything in life, you know, a spouse, a friend, you know, these relationships don't happen overnight.
It's something that you need to nurture and it's the same thing with being part of any community.
Geoffrey Toffetti (20:03.662)
That's right.
Geoffrey Toffetti (20:09.538)
Yeah, and I don't remember who said it, but someone said the grass isn't greener on the other side. It's greener where you water it. You know, and that is exactly what you're describing, where you put your effort is where you're going to get your results. And it's true for the client. And it's true, as you say, for companies that can help each other out. If you don't invest any time, you're not going to get a return.
Michael Bernzweig (20:16.164)
That's right there.
Michael Bernzweig (20:29.89)
Now earlier you mentioned that you had acquired the couple of competitors in the space. So I guess my question is, obviously they had their existing clients, they had their existing technology. Did you maintain their technology, roll it up into what you're doing? How did you address that and where are you at with that?
Geoffrey Toffetti (20:55.916)
Yeah. So, we've fully converted now, with Drake Beale, we had to maintain the technology for a little while because there was one thing that he had going, with one of our, one of the major clients that we acquired him for that we couldn't just instantly replace. so that we maintain that, but it was a pretty light piece of technology. wasn't, it wasn't enterprise, software from that. was a website portal.
that allowed people to submit their own information. So we had to maintain that. But the TSA was, it was interesting. I could claim this as brilliant thesis on the acquisition, but I'm not going to, I'm going to tell you what actually happened. When we acquired them, they were about to release a new version of their software that they had been teasing to their marketplace of customers, but they had never shown them. So we just released ours as their new version and there was no
Michael Bernzweig (21:38.37)
Yeah.
Michael Bernzweig (21:53.378)
I love it.
Geoffrey Toffetti (21:54.03)
So we were able to flip about 80 % of their customers in the first year. And then it was a very, it was like I said, you could imagine if that, if I had thought of that as the thesis, it would have been brilliant, but it just, it was just good luck. And we capitalized on it.
Michael Bernzweig (21:59.686)
isn't that magic?
Michael Bernzweig (22:09.41)
Well, keep that in the back of your head or for anybody listening to the podcast that's going through a merger or an acquisition. That's, that's...
Geoffrey Toffetti (22:15.722)
Yeah, look into that stuff because a version upgrade could easily just be your product. They wouldn't know the difference.
Michael Bernzweig (22:21.206)
Yeah, that's brilliant. That could be a strategy. I love it. I love it. So in the whole transition from both organizations, I guess the other thing that comes to mind, obviously, you have brilliant people in many organizations. I'm sure many of the people stayed. But as far as
Geoffrey Toffetti (22:25.878)
Yes, it was, it worked out for us, but yeah.
Michael Bernzweig (22:48.578)
the concepts and the technologies and the things that they were doing that were different than what you were doing. Did you learn some things along the way that you were able to incorporate in your final solution as it stands today or how did things work out?
Geoffrey Toffetti (23:04.258)
Yeah, think personally it would be really foolish to buy a company that you're competing with and not listen to what they have to say about what works and what doesn't. But there was definitely things from a training standpoint, from the content, the consulting experience, the knowledge that we were able to integrate into our broader IP and it added value for sure. Plus the relationship capital is you want to...
You want to be able to leverage their relationships. And in order to do that, you have to be able to integrate them into your culture or else they're not going to help you. You know, you're going to end up in this weird tension, which happens in that in integrations all the time, you ended with this weird tension. So we worked really hard to bring the teams that we acquired into the culture of our company before we started asking them to, you know, trust us with their most sacred relationships. Cause it's one thing to have a contract. It's another that.
the person's texting them on the weekend and they're friendly with each other. You know, can't just take that from someone. But there was definitely, there was a few things on the TSA front that technologically we liked. We didn't use theirs, we rebuilt it in the same vein. So yeah, we definitely added some capabilities to our platform based on the technology that they had.
Michael Bernzweig (24:22.34)
Neat. And obviously you want to provide the most value to your clients. you know, it sounds like you're there in terms of the front desk, in terms of the restaurant and all of that. And obviously those are the lowest hanging fruit for any of these organizations. Is the goal to pick the next major
piece of low hanging fruit and implement that? Or is that the focus on growing the customer base or a little bit of both? Or what do you see as the next right steps?
Geoffrey Toffetti (24:58.636)
Yeah. So yeah, we have kind of three areas of focus. One is to continue to expand the food and beverage because we're fairly new at it. But in the 2500 hotels we have, there's over 7,000 restaurants. So it's a, it's a, you know, force multiplier for us. interestingly, the systems that food and beverage run on, because we are dependent on getting data out of the client systems. So where you can take friction out of that is the best. So the next place would be retail.
because they use the same point of sale system as the restaurants in many cases. So that would be a data source we wouldn't need to then again integrate with from scratch. But the restaurants is also multiple things. there's the sit down restaurant you think of when you hear restaurant, there's also the lounges, the bistros, the pool bars, all of those are also in there. There's also fast food, there's marketplaces. there's room service.
So there's like four or five sub categories within food and beverage that we're not penetrating all of them yet. So there's room to grow in there. And the reason that I pushed us so hard to go toward food and beverage, because there's plenty of business out there at Front Desk only to just continue to grow the business. it's because the food and beverage in hospitality has connective tissue to restaurants outside of hotels.
Now the restaurant market outside of hospitality is 10 times the size of the restaurants inside hospitality. where it's like hospitality is our proving ground, but there are people just like hotels, there's people that own the restaurant that are not the hotel and there's managers that manage restaurants inside a managed hotel. So there's another third party involved. So that connective tissue could, we could draw it out into a much bigger marketplace. And that's where the TAM gets.
Michael Bernzweig (26:32.088)
Yeah.
Geoffrey Toffetti (26:49.686)
really, really interesting because of how vast the restaurant marketplace is.
Michael Bernzweig (26:55.132)
So for hotels, what are, you know, if you could break it down into a bulleted list, what are the other entities that they're interfacing with before the client arrives at their front door? Obviously a booking site, you know, maybe some sort of a hotel app that's booking spaces at their onsite restaurant. What are those different?
and to
Geoffrey Toffetti (27:24.994)
Yeah, there's, it is a highly fragmented ecosystem, but yes, you're, you're looking at a booking site. could be the brands reservation group or website, or it could be, you know, booking.com or Expedia, the, OTAs. and then there's a set of apps that come into play that are, described as pre-arrival where once the booking is made to the hotel. Now this is, there, this is also nuanced because if it's done through an OTA, the pre-arrival doesn't work.
because they can't offer them the ancillary. And if it's done through an OTA, the hotel can't do it because they don't have their contact information. So there's a subset of direct bookings to hotels that then in some cases are made, there's a digital offer made to them via email or text to say, we see you're arriving, you've booked this room, we have a view of the Gulf available, know, would you like it? And then when they arrive, that's where we come into play. We're the on arrival solution. So the front desk then will
offer them, you know, enhancements and same with restaurants, you know, work with them to offer the most excuse me, that someone could, could procure. And then there's, there's some solutions in the, marketplace now that are doing in-stay during stay offers via text communication and during tablets in the rooms and things like that, that are trying to get to them after they checked in. Those are fairly new and not, not as penetrated, I think as the first three segments, but
Yeah, it's the customer journey is highly fragmented and it's a problem for the marketplace because the OTAs don't talk to the pre-arrival companies. The pre-arrival companies don't pass that information to the the PMS system at the time of check-in. So we're working toward bridging those gaps through integration and partnerships and other things along the way because the intelligence is being lost at every turn. There's a cliff and
the Intel you're getting from the process drops into the abyss and then you start over and then it goes in and drops into the abyss and you start over. If we could pass that through, we could dramatically improve the buying experience for the guest.
Michael Bernzweig (29:30.732)
So looking from the outside in, obvious clear opportunity for the solution would be, obviously you have all of these other entities that are bringing clients to the hotel.
and obviously taking a percentage or a cut or some, they have some way of generating revenue and they're adding value so it makes sense. Maybe another option would be to have all of those same types of solutions as a second option for the hotel.
where they can actually do all of those things directly without any of the cut going to a third party or choose to use all of those third parties. So maybe there could be two paths for any one of those different entry points.
Geoffrey Toffetti (30:26.712)
Yeah, there are hotel groups, think about it at the brand level, that are working to vertically integrate all of these touch points into an operating platform that they have control over. For small hotel companies, it just wouldn't make sense, the capital required to do that. Yeah, exactly. But the big guys, they're working on it. They're kicking the tires. In some cases, they're even...
Michael Bernzweig (30:46.334)
It's like running a whole other business. Yeah.
Geoffrey Toffetti (30:55.446)
at the beginning of implementation of some solutions. But I think the most profitable companies in the ecosystem are the OTAs. And so to claw that away from them is gonna be tough, but the direct to brand is a major priority for the brands to get bookings directly. They still do a huge number of reservations, but the other stuff after the booking, definitely the hotels are trying to get more involved with that.
Michael Bernzweig (31:24.632)
Yeah, that's really interesting. I had just read a story of an organization that tried to recreate what SAP has done in that space. And after four years of trying, they threw their hands up in the air and said, it's just, it's not possible.
Geoffrey Toffetti (31:43.852)
That's right. It's, it's an instrument. It'll be a step function change. It won't be the same. Like what SAP did hadn't been done or you could say Oracle and SAP, they're kind of the same in my mind, but it'll be something completely different. It'll be like a super agentic AI infrastructure that goes and figure stuff out on the fly. You won't build a giant enterprise automation system like that again. don't, you don't, you can just go get SAP. There's no point in building a new one.
Michael Bernzweig (31:53.262)
Yeah.
Michael Bernzweig (32:11.672)
Yeah, exactly. Why recreate the wheel as they say, right? We've got a lot of.
Geoffrey Toffetti (32:14.164)
Yeah, and that's like recreating the, I don't even know, an entire junkyard of wheels. You know, it's, so much stuff.
Michael Bernzweig (32:20.1)
We've had for sure a lot of analogies in this episode, but as we're wrapping up, it's just from where you sit, which is in a very unique space, what's exciting to you about the future? What areas do you have your eye on that you think are really gonna move the needle for clients in your industry?
Geoffrey Toffetti (32:44.834)
Yeah, I I've mentioned earlier there were three things we were focused on. This is the third thing is we see a huge opportunity and a gap in the market to use AI not to replace human labor, but to support and augment human capacity. And doing it in the front line is very straightforward in that we have immense amount of data. We know what works and what doesn't work.
So we can give guidance. We can coach, give guidance using AI agents. So that's something we're focused on is, is how do we help the frontline be even more productive? Because in the hospitality space, I mean, I could see a decade from now or two, there could be robots at the front desk. But I think that generally when you go on vacation with your family, you want to be greeted by a person, not a robot, right? So there's probably a very long tail on human interaction and hospitality. So we want to use AI to
Michael Bernzweig (33:35.577)
it.
Geoffrey Toffetti (33:42.168)
to maximize that, not diminish it. And that's, we think that's, that's what got me fired up every day. had, at a four hour meeting yesterday with my CTO and all we did was talk about this. It's really exciting. And the technology is finally at a, at a place where it's accessible to relatively, you know, regular tech companies. You don't have to be a Silicon Valley AI shop to get access to the tools. So it's probably the first dawn of
Widely distributed AI capability is right now and we're we're jumping in with both feet. We're not waiting for someone else And it's sad because I know business owners that that don't know anything about what's going on an AI. They're they're almost like Willfully illiterate and if I've been telling my some of my peers this if you're not already waist-deep in it You're already behind because it's moving so fast But the flip side of that is what it could do for your business in in
Michael Bernzweig (34:32.984)
Yeah.
Geoffrey Toffetti (34:39.446)
in months instead of years is really unprecedented.
Michael Bernzweig (34:41.986)
Yeah, and I think, you know, the interesting thing and probably the biggest question mark for a lot of organizations, especially larger organizations with AI is, you know, are we sharing data that we don't even know we're sharing? And I think there are at this point many solutions that do keep your data protected in a safe space where it's only it's not being shared with the LLM.
Geoffrey Toffetti (34:55.576)
Mmm.
Michael Bernzweig (35:10.596)
And I think, you know, that fear is not so much a reality anymore in 2025, as long as you're taking the right steps and doing what you need to do. But I think there's a lot of, you know, misconceptions about AI.
Geoffrey Toffetti (35:23.0)
Yeah, I mean if...
Geoffrey Toffetti (35:28.514)
Yeah, think there's there there's two, I think big ones. One is there. If your employees are going to a publicly available LLM and typing in proprietary information and trying to have it help them, that could be a risk. well, but the other thing is when you're building AI into your tech stack, you have your own agents that you're building that are working on your data inside your tech stack. You're not necessarily relying on an LLM externally. So yeah, there, I think a lot, they've come a long way with that. It's like.
you're borrowing the processing power of the AI. You're not, you're not feeding it your data. so there, there is some security concern there. The bigger one, I think is when employees get really excited and they go in and like paste in a proprietary report and say, help me write a new version of this. And now that's, that's who knows where that went. Right. but so I like, we've taught our people, if you're using them, you know, make it anonymous, take, replace our, our name with the word company and, know, do stuff like that.
Michael Bernzweig (36:16.215)
Exactly.
Michael Bernzweig (36:26.158)
Yeah.
Geoffrey Toffetti (36:27.722)
And, but it is, it's just incredibly powerful. What is, what is available now.
Michael Bernzweig (36:30.2)
Yeah, it's education I think is the biggest part of it. And you you do have platforms like perplexity where, you know, they have all of these, you know, functionalities in place for clients so that they can at the flip of a switch, you know, keep everything internal versus shared with the LLM. So, and I think I'm not sure if it is, but at one time I think that was their default.
Geoffrey Toffetti (36:51.544)
Exactly.
Michael Bernzweig (36:57.056)
setting. You know log in you're in your own private cloud.
Geoffrey Toffetti (37:02.498)
Yeah, and I know Amazon also has some new solutions that are more like the whole toolkit for AI that you need. And I'm sure they have the same, I haven't dug into it, but I'm sure they have the same kind of protocols where you can go captive or public with the data.
Michael Bernzweig (37:18.772)
Neat. Well, this has been a great deep dive in an area that I'll be honest with you with hundreds of episodes under my belt I have not delved into. So this is interesting for me and for the audience.
Geoffrey Toffetti (37:31.234)
Well, that's great. I like being unique. Yes. And I appreciate you having me on here. I mean, I really do. I appreciate your time. was a great conversation.
Michael Bernzweig (37:38.134)
Yeah, absolutely. have for anybody that is possibly tuning in for the first time, aside from software spotlight, we also have two sister podcasts, the career spotlight, which is for anybody looking to transition from one space into another, which might be in the tech field. We also have consulting spotlight, which are
for organizations that are trying to answer the question, know, what type of consultant do I need for the challenge that I even have? So that's also in the family of podcasts. Very happy to say that this month we've actually last month just turned the needle and went over 35,000 downloads for the month. So really excited to announce that.
Geoffrey Toffetti (38:29.262)
Wow.
Michael Bernzweig (38:32.548)
for anybody that is looking to strengthen their partnerships. So if you're in the B2B space or in the consulting space, the beginning of next month, we have our partnership summit coming up. So if you go to softwareoasis.com, you will see a giant orange button where you can sign up to attend the summit. It is free and it's a really fun space to.
learn quite a bit. It's educational and a really great opportunity. We have over 50 speakers that will be joining us for this next summit and a lot of fun things going on. So anyways, I really appreciate your taking the time out to join us on the software spotlight this week. We've had Joffrey Toffeti, the CEO of FPG and discussing their app, IN-Gauge.
Geoffrey Toffetti (39:30.626)
Yes, thank you, Michael. It's a pleasure to be with you.
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