Citibank/Microsoft-Backed Bundle ‘Rates’ Restaurants, Others Via Credit Card Data

Yelp reviews are susceptible to a lot of noise — relatives and friends of a business, mischief makers, people without any perspective (or taste). In fact, most review sites — Trip Advisor, Zagat, etc. — are affected by these factors.

Some sites have tried to get around this problem by using proxies for reviews. A few years ago, for instance, Grayboxx used “mentions” of a location as a proxy for reviews, assuming that the majority of mentions would be positive ones. That method, however, proved to be inaccurate and especially dicey in smaller markets. Other sites are experimenting with the use of check-ins and tweets as review/rating substitutes.

Now comes Bundle, a new service with seed funding from Citibank, Microsoft and Morningstar. Bundle, which is based in New York City, has built the algorithms to clean and sort “mentions” from 20 million-plus Citibank credit cards. While other services work with credit card companies for loyalty programs and recommendations, we haven’t seen companies that can actually apply algorithms to aggregated, anonymized credit card data.

Bundle scores are based on the popularity of a restaurant (i.e., number of visits); the number of repeat visits by customers to a restaurant; and the amount people are willing to pay when they eat at the restaurant. One assumes scoring can easily be applied to other categories as well.

CEO Jaidev Shergill tells us that the company started two-and-a-half years ago as a money management site that would analyze statements for better budgeting practices, etc. But the company changed its business model to “solve problems for people using our differentiated data asset.”

“Local search and discovery have become bigger and the importance of accurate, relevant reviews is increasingly important. However, there is no way to tell whether the review is relevant to you,” says Shergill. Credit card data, coupled with aggregated demographic and behavioral data, clears the hurdle.

The service launched last December in New York and San Francisco, and nationwide on Jan. 1. “We have 2 million merchants ‘rated,’ ” said Shergill. “That’s as many as Yelp. It will get richer as the months go by.” He also notes that unlike review sites, Bundle doesn’t need to go market by market for reviews.

Shergill acknowledges some limitations to Bundle’s methodology. If there is no data, there are no ratings. So that rules out cash-only places. The data also can’t distinguish how many diners are on the check, although individual prices can be estimated based on pattern analysis. But a quick look at my ZIP code (“92009”) showed fairly robust, accurate results.

Bundle CEO Jaidev Shergill is speaking at ILM East March 26-28 in Boston along with Next Jump CEO Charlie Kim and Cartera Senior VP Jim Douglass. Register here.

Bundle CEO and Founder Jaidev Shergill