Hotspot is an app for finding nearby happy hours and buying discounted drinks.

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What: Hotspot, an app for finding happy hours and buying discounted drinks.

Who: Jasjit Singh, co-founder and CEO; Jared Jones, co-founder and chief operating officer; Ryan Gerber, chief creative officer

Navigating happy hours: Hotspot shows users happy hours across Seattle and lets people purchase discounted drinks through the app. A well drink at Re:public in South Lake Union, for example, costs $3 through the app rather than the regular $7. Users make the purchase and show the bartender their screen to redeem the sale.

How it’s done: Hotspot facilitates the cheaper drinks (and cover charges and other services) by partnering directly with bars and restaurants. “We buy drinks wholesale from a venue, then tack on a small fee to what the user pays,” Jones said. Bars have the option to turn deals off if the venue gets crowded.

Academic drinking: Singh and Jones met at Yale University and entered the Yale Entrepreneurial Institute, an incubator program to develop student companies. The pair wanted to help bars connect with customers and get them to come in as often as possible. The app shows the nearest bars and deals.

Digital connection: Singh realized how hard it is for owners of brick-and-mortar stores to connect with customers when he opened a video-game center for kids in Portland. Businesses that have a strong online presence continually gather contact information and data about their customers. But physical stores can struggle to build relationships with customers, Singh said.

Free drinks, please: Hotspot is running a promotion to build its customer base. New users receive a free drink when they register for the app and also when they refer friends.

Deals galore: Hotspot’s competitors include the entrenched Groupon and Living Social. Jones said Hotspot provides a better benefit to partners than Groupon, which usually discounts an entire meal or activity. “Our advantage is, we only give discounts on high-margin items, only on the first item and on, competitively speaking, small tickets,” he said.

Glass half full: Hotspot has four employees and $45,000 in outside funding. The app is gaining speed, though. It now has 1,000 users, and 250 of them use Hotspot every week. That number is increasing about 8 percent each week.

— Rachel Lerman