Wellness Tips

Grazzy Helps Service Workers Earn More Tips and Access Their Money Faster

Grazzy founder and CEO Russell Lemmer. | Photo: Grazzy

Sure the latest initiatives from the Teslas, Apples and Googles of the industry tend to dominate the tech news space — and with good reason. Still, the tech titans aren’t the only ones bringing innovation to the sector.

In an effort to highlight up-and-coming tech companies, Built In launched The Future 5 across seven major U.S. tech hubs. Each quarter, we will feature five early-stage tech companies, nonprofits or entrepreneurs in each of these hubs who just might be working on the next big thing. Read our round-up of Austin’s rising companies from last quarter here.

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Tipping service workers is standard practice at U.S. bars, restaurants and hotels. As many consumers have moved away from cash and instead rely on credit cards, tip totals have increasedbut now service workers are subjected to waiting several days before receiving their money. 

Austin-based Grazzy wants to facilitate the tipping process for all service workers with its digital platform that removes friction from the tipping process. The platform also helps workers access their tips the same day they receive them.

Tipping with a debit or credit card is easy for the consumer, but workers have to wait until the end of their shift to find out how much money they made that day. If an employee splits tips with their coworkers, it could take a few days for the tips to be distributed. Grazzy’s platform enables restaurants and hospitality businesses to collect tips and tip out their staff on the same day. 

The platform also eliminates the need for cash tipping in other businesses where tipping is common practice. With Grazzy, customers digitally tip workers directly by scanning a QR code that will direct them to the employee’s tipping portal. 

Image of Grazzy QR code for tipping.
Grazzy’s scalable QR code is used to directly tip service workers. | Photo: Grazzy

“Grazzy is a next-gen payment and payroll platform. We help employees make more money and access it on the same day,” Russell Lemmer, Grazzy founder and CEO, told Built In. 

Lemmer came up with the idea for Grazzy while traveling. When leaving a renowned hotel in Las Vegas he said he reached into his pockets to tip the bellman, only to find that he wasn’t carrying cash and couldn’t tip the bellman. 

“I wanted to tip the guys who brought my bags around and I didn’t have any cash. It was an awful moment,” Lemmer said. “I was thinking to myself that these guys just aren’t getting tipped at all anymore since so many people don’t carry cash.” 

In addition to facilitating tipping, Lemmer said the Grazzy platform can also help businesses retain employees. For the past few years, quit rates among restaurant workers have increased, and businesses have had a hard time staffing their restaurants. According to CNBC, 70 percent of hourly workers making minimum wage leave their job in less than a year. Several factors have created this issue, but according to Lemmer, it all comes down to money. 

“Recruiting and retaining hourly employees is as hard as it’s ever been. It typically comes down to folks just wanting a little bit more money, better access to that money and better ways to save and spend,” Lemmer said. “If they worry less about their financial wellness in a job, they’re much more likely to stay where they are.” 

In January, Grazzy raised $4.25 million in seed funding, its second seed raise. The company has now raised $6.8 million in funding to date. 

The Grazzy platform has already been incorporated in thousands of service-based businesses nationwide. According to Lemmer, the company will continue expanding its businesses over the next few years. Grazzy is also looking to develop new financial products that will improve the livelihoods of service workers.

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