SUMMARY
Zomato has previously invested in Curefit, magicpin and Shiprocket which was followed by the company acquiring BlinkIt (previously Grofers)
Zomato has invested around $15 Mn in AdOnMo for a 19.8% stake and $5 Mn in UrbanPiper Technologies for a 5% stake
Both investments are aimed to accelerate Zomato’s growth and help the invested companies fill gaps in the food ordering and delivery ecosystem in India
Foodtech giant Zomato has invested in two tech startups — INR 112.20 Cr (around $15 Mn) in adtech company AdOnMo for a 19.8% stake and INR 37.38 Cr (around $5 Mn) in enterprise tech platform UrbanPiper Technologies for 5% stake.
According to the company filing, as seen by Inc42, the Zomato board has also approved the incorporation of a wholly-owned NBFC subsidiary. While the company is yet to provide details on the NBFC, Zomato had, in August 2021, launched payment services for its users.
Named Zomato Payments, the wholly-owned subsidiary was said to issue, implement, undertake, assist, offer, distribute, or otherwise promote such services, schemes and projects including electronic and virtual payment systems services, e-wallets, mobile wallets, cash cards to consumers, among others.
Into The Zomato-Verse
Zomato has bigger ambitions than food delivery, which it has previously made clear. The company’s recent announcements of investments in Curefit, magicpin and Shiprocket underlines the first step that the foodtech giant is taking towards diversifying its business in the long run. It had followed Zomato’s investment in BlinkIt (previously Grofers) and the quick commerce segment.
The move by Zomato to invest in startups after going public can be seen as a way of diversifying its portfolio. It had also previously been reported that the company plans to invest $1 Bn across startups and build a multi-layer ecosystem — majorly via M&As.
According to Zomato, approximately 80% of restaurants still use legacy systems or manual processes leading to delays in food orders and errors in order processing. UrbanPiper solves this problem for restaurants through technology helping more restaurants become ‘food-delivery ready’.
Zomato has invested in Urban Piper as a part of a larger $24 Mn round, with an aim to fuel UrbanPiper’s penetration in the restaurant industry.
Founded in 2015 by Anirban Majumdar, Devarshi Shah and Saurabh Gupta, UrbanPiper is a SaaS platform that acts as a middle layer between restaurants and food ordering and delivery players. It enables restaurants to seamlessly integrate with multiple players through a single digital interface.
UrbanPiper’s offerings include white-labelled and customisable websites and apps, a CMS and CRM dashboard to manage and analyse the online presence and a tool for customer segmentation and campaigning to make it easier to keep customers engaged. Tiger Global and Sequoia-backed UrbhanPiper, currently processes around 12 Mn monthly orders for 23K+ restaurants.
AdOnMo, on the other hand, is an adtech startup, founded in 2016 by Sandeep Bommireddi and Sravanth Gajula, that provides outdoor advertising solutions. The startup enables targeted, real-time advertisements on cloud-connected digital screens
Zomato stated that the AdOnMo platform will help its food ordering and delivery business ‘leverage new digital avenues for customer acquisition’.
It is noteworthy that Bace Fund LP, a venture fund where Zomato founder Deepinder Goyal has invested $100K, is an AdOnMo investor.
In the regulatory filing, Zomato has claimed that Goyal’s investment in Bace Fund is ‘an insignificant portion’ and thus, the current investment in AdOnMo is not a related party transaction.
