Investors have placed bigger bets on Swiggy as it vies with older peer Zomato to deliver piping hot food to hungry customers. The two restaurant search and ordering startups gulped nearly $2 billion of investor money this year. Swiggy got more than half of it. It raised nearly $1 billion from a clutch of investors this week, making it the largest online food venture in India valued at $3.3 billiobillion, according to people familiar with the matter. This has been the best year yet for India’s food search and ordering startups. Swiggy and Zomato raised three times the funds food delivery ventures received in the last four years, according to data shared by Venture Intelligence. Investor optimism comes after two years of consolidation when several delivery ventures either shut down or were acquired. The market, according to Redseer, is expected to nearly quadruple to $2.5 billion by 2021. And it’s only expected to boom as cheap data encourages online ordering.
“The food-tech industry today is more about who is able to attract most money and investors, and then about services or innovation,” said Harminder Sahani of retail consultancy Wazir Advisors. “There is not much difference in any of the players.”
Zomato, which counts Ant Financial, Sequoia Capital and Temasek among its investors, has raised $610 million in all since inception in 2008, according to data cited by Crunchbase which aggregates information on startups. Swiggy, founded six years later, has already surpassed it, raising $1.5 billion in all from investors including Naspers, China’s Tencent and Meituan Dianping, out of which nearly $240 million was part of the secondary sale.
Swiggy’s latest funding builds pressure on Zomato to raise more money, Satish Meena, New Delhi-based analyst at Forrester Research, said over the phone. The investors who back Zomato won’t let Swiggy to win the battle via capital, he said. Both the startups have yet to respond to BloombergQuint's emailed queries.
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