Amidst merger talks with Zomato, online food ordering and delivery platform Swiggy has raised $100 Mn in Series F funding round led by Naspers. With this round Swiggy also on board the new investor Meituan-Dianping, who is one of China’s largest service ecommerce platform.
This is Swiggy’s largest funding round so far, making the company’s total funding to reach $255 Mn+, since its inception in 2014.
“As India’s leading food ordering and delivery platform with a network of thousands of restaurants and millions of users, Swiggy has become part of consumers’ everyday lives. We want to continue to bring convenience, choice, and reliability to our users as we fulfill our mission of ‘Changing the Way India Eats’,” said Sriharsha Majety, CEO, Swiggy.
Earlier, in January 2018, reports also surfaced that Swiggy is in talks with Naspers and Tencent to raise a $200 Mn funding round.
To be noted, recently Zomato also raised a massive $200 Mn funding from Alibaba’s Ant Financial.
Swiggy: Plans To Utilise The Newly Raised Funds
With this new funding, Swiggy will further strengthen its market leadership position by introducing a host of unique and advanced products and services.
As part of its long-term strategy of solving for existing supply gaps in the marketplace, Swiggy will also make investments in its New Supply business line.
After the successful launch of its first New Supply initiative, ‘Swiggy Access’ in November 2016, the new capital will be used for further expansion. Swiggy will also continue innovating its core technology platform, especially in the areas of data-driven self-learning systems that leverage machine learning and artificial intelligence.
The company will further build on its adaptive, real-time prediction and optimisation systems to further improve consumer choice and personalisation, along with speed, volume, and efficiency of deliveries.
“With this funding, we will further invest in building differentiated offerings, plugging the white spaces in the ecosystem, and developing our technology while keeping superlative customer experience at the core,” added Sriharsha.
Swiggy: The Turnaround With The New Initiatives
Founded in August 2014 by Sriharsha Majety, Nandan Reddy, and Rahul Jaimini, the platform is currently functional in over ten cities and has reportedly partnered with 20,000 restaurants.
After the 2016 winter, the Indian foodtech market is on its path to revival. Even the biggies in the domain like Zomato, Swiggy had to suffer a setback. However, with the increase in adoption of digital payments post demonetisation and entry of foreign players like UberEATS, Google Areo, the online food ordering and delivery market have once again gained its pace.
A few months earlier, speculations arise that Swiggy is on verge of getting merged with Zomato, who has already declared itself a profitable entity in FY 17.
However, Swiggy has continued to innovate and introduce new avenues of growth and generating revenues to continue its journey. From cloud kitchen to introducing new supply chain, Swiggy has been aggressively working to promote its market share in this segment.
Since the last round of funding, Swiggy has introduced a slew of new initiatives like Swiggy Access, long-distance deliveries and Capital Assist to help restaurants serve consumers in new and more powerful ways.
The company also strengthened its senior leadership with several additions to the team including those from the recent acqui-hire of gourmet food startup 48East. It also underwent a revamp, making it more intuitive and personalised to each consumer.
Swiggy has posted a record increase of 500% in revenues in the last financial year and saw order volumes nearly double since its previous funding in May 2017.
“Swiggy has continued strong growth through 2017 and now has a clear lead in the market,” said Larry Illg, CEO, Naspers Ventures. “The company’s performance is all the more impressive given the intense competition we see in the food ordering and delivery business in India. Swiggy has shown it has the ability to rise above the competition and create long-term relationships with its users,” he added.
As of now, Swiggy claims its average delivery time as an industry benchmark of under 35 minutes. It has also unlocked the business potential of partner restaurants across eleven locations in India, including Delhi, NCR, Mumbai, Pune, Hyderabad, Kolkata, Bengaluru, Chennai, Ahmedabad, Jaipur, and Chandigarh.
According to a study by Netscribes Research, the online food delivery segment in India is expected to expand by 34%-36% between 2015 and 2020. A Forbes report further revealed that this space grew by 150% in 2016 owing to the entry of major players in the segment.
The rising opportunity in the online food ordering space is also calling in unicorns like Flipkart, Paytm and Amazon India to test waters. Amid the rising competition, this funding boost from Naspers and Meituan-Dianping is a fresh breather for Swiggy. Going ahead, will the latest fundraiser could help the company get on the path towards profitability in FY18, will be interesting to watch.