SUMMARY
With A91 Partners’ infusion in the funding round, IIFL will sell part stake in Box8 that it helds following its investment in 2016
The current secondary transaction is an extension of the previous funding round when EatClub Brands’ was pegged at $300 Mn
As a part of the deal, angel investors who backed the startup are also exiting with good returns
Cloud kitchen startup EatClub Brands, which was earlier known as Box8 is going to seal its secondary funding round deal of nearly $30 Mn. The startup’s existing investors, Tiger Global and A91 Partners will increase its stake.
With A91 Partners’ infusion in the funding round, IIFL will sell part stake in Box8 that it holds following its investment in 2016. In addition, IIFL and A91 will also buy new shares owing to their primary infusion in EatClub Brands, according to a ET report.
Tiger Global had previously made a $40 Mn investment in EatClub Brands. The current secondary transaction is an extension of the previous funding round when EatClub Brands’ was pegged at $300 Mn.
According to the above-cited media report, the size of Box8’s funding round is marginally more than what was earlier decided. As a part of the deal, angel investors who backed the startup are also exiting with good returns.
“As part of our last round, Tiger Global is doing an additional secondary tranche worth almost $11 Mn,” Anshul Gupta, cofounder at EatClub, told ET.
Founded by Gupta and Amit Raj in 2012, EatClub Brands pivoted from a QSR chain to its present business model in 2014. It currently holds eight brands and operates in five Indian cities.
The startup told ET that it runs 150 cloud kitchens, whose earnings before interest, depreciation, tax, and Edbita varies between 20-30% depending on the locality, age of the kitchen.
In December 2021, Box8 raised $40 Mn in a Series D funding round led by Tiger Global. Along with the raised funding, the startup rebranded itself to EatClub Brands as well. The startup planned on utilising the freshly infused capital for on-boarding talent and building teams that can support its plans to scale its business to more than 500 kitchens in 15 cities.
Of late, another cloud kitchen, Kitchens@ merged with Delhi-based Kitchens Centre. The move would make the combined entity the biggest player in the space with more than 1,000 cloud kitchens spread across 20 cities. This merger would enable it to rapidly scale up and increase its presence across the country. It would also help the two startups to leverage each other’s strong supply chain links to complement its operations.
In February this year, cloud kitchen brands aggregator Curefoods announced its acquisition of exclusive franchise rights in South India for the globally renowned pizza brand Sbarro. Curefoods plans to open 50 Sbarro outlets in the next three years, starting with Bengaluru. The expansion would consist of a mix of walk-in outlets and cloud kitchens to ensure maximum customer reach.
