To Strengthen Its Business, The Foodtech Platform Has Also Hired Its First Ever CFO, Rahul Bothra
With global investment giants Softbank and Tencent looking to lead massive investment rounds in Swiggy, the Bengaluru-headquartered foodtech platform has doubled down in its efforts to get ahead of competition by strengthening its upper management. As per its official statement, the startup has appointed Vishal Bhatia as the CEO of the New Supply business line, of which Swiggy Access is one initiative.
The responsibilities of the New Supply CEO will revolve mainly around bolstering Swiggy Access’ delivery-only service to eliminate inefficiencies in the existing restaurant supply chain and consumer gaps in terms of assortment availability.
Prior to joining Swiggy as the CEO of New Supply, Bhatia worked as the Global Brand Director of RB. He has also previously served as the Marketing and Sales Head – Value Snacks Business at PepsiCo. According to sources, Swiggy has also hired its first ever Chief Financial Officer, Rahul Bothra, in a bid to strengthen its balance sheet and look for ways to scale beyond the online food delivery business.
Commenting on the development, Swiggy co-founder and CEO Sriharsha Majety said, “As Swiggy prepares for the next phase in our growth, the new leaders will spearhead strategic initiatives that will create sustainable long-term value for our consumers and the marketplace. This requires concerted efforts and a very strong understanding of the consumer, coupled with the execution excellence that they bring onboard.”
An Overview Of Swiggy Access
Launched in the third week of November, Swiggy Access is a strategic initiative aimed at reaching more customers and making its delivery more seamless. Geared towards facilitating business expansion of partners on the platform, the new service allows restaurant partners to set up kitchen spaces in areas where they do not have a physical presence.
At the time of its launch, Majety stated, “Swiggy Access is another step towards giving our consumers what they come to Swiggy for – great variety, delivered at a lightning fast speed. Over the years, Swiggy insights have helped us understand that people from several parts of our cities long for a much better selection of food, including their favourite restaurants in their neighbourhood. With Swiggy Access, we are diversifying local palettes, bridging geographical gaps in supply and solving for variety, quality and convenience of food.”
These ready-to-occupy kitchens currently offer restaurant partners rent-free access to a basic setup with all required amenities. With assistance from Swiggy, restaurant owners will also be able to optimise their kitchens in terms of stocks planning, demand forecasting, preparation time and order edits, among others.
As part of the initiative, the foodtech startup has already set up a Swiggy Access kitchen in Bengaluru’s Marathahalli area. Boasting a total area of 3,200-sq-ft, the facility will be serving signature dishes from Leon Grill, Keventers, Punjabi Rasoi as well as the company’s private brands House of Dabbas and The Bowl Company. The appointment of Vishal Bhatia as the CEO of the New Supply business is, in fact, in line with Swiggy’s diversification goal.
The Growth Story Of Foodtech Startup Swiggy
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. Headquartered in Bengaluru, the foodtech startup has raised a total of $155.5 Mn funding to date.
In May this year, the company raised $80 Mn in a round led by Naspers at an estimated valuation of $400 Mn. The round also saw participation from existing investors Accel India, SAIF Partners, Bessemer Venture Partners, Harmony Partners and Norwest Venture Partners. Earlier in September 2016, Swiggy picked up $15 Mn (INR 100 Cr) Series D funding led by US-based venture capital firm Bessemer Venture Partners and other existing investors.
Towards the end of November, it was reported that both Softbank and Tencent are eyeing to invest in Swiggy, along with homegrown ecommerce giant Flipkart. The Japanese conglomerate Japanese is reportedly gearing up to pour $200 Mn-$250 Mn investment in foodtech startup, while Tencent is currently in talks to co-invest $100 Mn. If successful, the investment would likely take place at a pre-money valuation of $600 Mn-$650 Mn.
Reports of Flipkart initiating acquisition talks with Swiggy first surfaced in October, when it was said that the homegrown ecommerce player was gearing up to diversify its business through acquisitions and investment. Most recently, in the third week of November, The Ken reported that Flipkart was preparing for a possible infusion of $50 Mn in Swiggy.
In an interaction with Inc42, a spokesperson from Swiggy stated that the company clocked 4 Mn orders in July 2017 with a steady increase since. It has partnered with more than 20,000 restaurants so far. Incidentally, earlier this month, reports surfaced that Zomato and Swiggy were holding discussions for a potential stock-based merger, on the basis of a 4:1 share swap. However, as per sources, the talks ultimately failed due to differences in valuations and business alignments.
As per filings with the MCA, Swiggy reported a massive 6x leap in revenues from $3.6 Mn (INR 23.6 Cr) in FY16 to $20.6 Mn (INR 133 Cr) in the last fiscal year. However, losses have also increased by 50% to $31.7 Mn (INR 205 Cr) from $21.3 Mn (INR 137.18 Cr) in FY16. One of the main reasons for the soaring losses has been the near 119% surge in expenses to $53.5 Mn (INR 345 Cr). Having onboarded former OLAM Divisional CFO Rahul Bothra as its new CFO, Swiggy is likely aiming to cut down losses and further enhance its revenues.
According to another study by Netscribes Research, the foodtech sector is expected to expand by 34%-36% between 2015 and 2020. At a time when the segment is witnessing the entry of new players like Google Aero and UberEATS, Swiggy has maintained its razor-sharp focus on thwarting competition and gaining a stronghold in the segment. The latest appointment of Vishal Bhatia as the CEO of New Supply business indicates the company’s aim to diversify its business beyond food delivery.
