Mumbai-based cloud kitchen startup Box8 has raised INR 30 Cr ($3.9 Mn) in its ongoing Series C funding round from existing investors US-based venture capital firm Mayfield and IIFL Seed Ventures Fund. The round was a mix of equity and debt funding.
According to the ministry of commerce affairs (MCA) filings accessed by Inc42, Box8’s parent company Poncho Hospitality has raised INR 10 Cr from Mauritius-registered Mayfield India II. As part of the deal, Poncho Hospitality has issued 4,237 preference shares to Mayfield at a price per share of INR 23,560.
On the other hand, IIFL Seed Ventures Fund pumped INR 20 Cr in debt funding and got 8,474 debentures at INR 23,560 per debenture. Box8 has already raised around $27 Mn from investors such as eWTP Ecosystem Fund, IIFL Seed Ventures Fund, Mayfield Ventures, Indian Angel Network and others in its Series C round.
Prior to this, IIFL and Mayfield had participated together in Box8’s Series B funding round in October 2016. The foodtech startup has also recently raised INR 20 Cr debt from Trifecta Capital. This is over and above the previous Series C funding. Indian Angel Network and Ganesh Ventures Fund are also some of the notable investors of Box8.
Founded by Amit Raj and Anshul Gupta in 2012, Box8 is a full-stack cloud kitchen startup. Box8 owns and operates the entire food value chain, from procurement of high-quality ingredients to food preparation to the last mile delivery. The startup claims to be serving over a million meals every month across its 110 plus outlets in Mumbai, Pune, Bengaluru and Gurugram.
Investors Bullish On Cloud Kitchens
Given the ongoing lockdown, cloud kitchens are one of the limited foodservice operators that are allowed to run. And the impact on the restaurant industry is expected to last for at least 6-9 months as consumers avoid dining out due to the pandemic fears. This is the primary reason for investors doubling down on their bets on cloud kitchen startups like Box8, Rebel Foods, FreshMenu and others.
An Inc42 analysis had previously noted that cloud kitchens are able to make 10% profit as compared to dine-in restaurants making 3% profits. DataLabs by Inc42 projects the market size of cloud kitchens to reach $1.05 Bn by 2023 in India with a growth rate of 12%. Currently, only 13% of the total market size has been tapped, showing a massive potential of growth for this business.
Besides Box8, other cloud-kitchen startups that have raised funding recently include Rebel Foods and Cross Border Kitchens. Rebel Foods, which operates food brands like Faasos, had raised $50 Mn in a funding round from Coatue Management while Cross Border Kitchens bagged an undisclosed amount led by Shreedhar Gupta.
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