From an eating joint that sought to solve a ‘hunger’ problem to becoming a huge Indian multinational restaurant aggregator and food delivery company – Zomato’s growth story is not only a perfect example of Atmanirbhar Bharat but also its young startups. And not to forget that Zomato broke the norms of how traditional India consumed their food.
Now Zomato is crucially riding to build an appetite among Indian investors. Zomato recently changed to a public limited company from a private company ahead of its planned initial public offering (IPO) later this year. On April 5, 2021, the famous food tech company passed a special resolution reorganising itself as Zomato Limited, starting April 9, 2021.
Zomato which holds a tagline ‘Never have a bad meal’, competes with Swiggy, UberEats, and Ola-Foodpanda among others.
How it all started
Deepinder Goyal and Pankaj Chaddah were IIT Delhi graduates who worked for Bain & Company in New Delhi. During that time an idea struck them as to how to save time and make it easy for people to access food. This is how ‘Foodiebay’ was established in 2008.
In a matter of just nine months, FoodieBay became the largest restaurant directory in Delhi NCR and its operations were later expanded to Mumbai and Kolkata. After two successful years, the company was rebranded as Zomato and since then there was no looking back. Every year the number of app users has increased steadily.
The increase in the number of users led the duo to extend it internationally and as a result of this Foodiebay was renamed Zomato on January 18, 2010.
The app-based restaurant aggregator allows users to browse restaurant menus, read restaurant reviews, and order food from partner restaurants in selected cities. The service is now active in 24 countries and over 10,000 cities as of 2019.
Zomato was one of India’s first food tech brands, and it has continued to introduce new features.
Zomato like any other start-ups had ups and downs in their company. After achieving success in Delhi-NCR, the business expanded to cities like Pune, Ahmedabad, Bengaluru, Chennai, and Hyderabad and then there was rapid expansion outside of India.
Zomato began expansion internationally in 2012, with facilities in Sri Lanka, the United Arab Emirates, Qatar, South Africa, the United Kingdom, and the Philippines. New Zealand, Turkey, and Brazil were added to the list in 2013.
Zomato bought Gastronauci, a restaurant discovery platform in Poland, and Cibando, an Italian restaurant finder, in 2014. The next year, Zomato rendered its most significant purchase, NexTable, a US-based online table reservation site.
However, 2015 was not a good year for Zomato with massive layoffs and losses. The company laid off about 300 employees, nearly 10% of its total headcount to cut costs.
Following a sluggish 2016, in which Zomato saw yet another drop in sales, the firm agreed to halt operations in nine of the countries where it had spread, managing them remotely to avoid losing market share.
As a part of Zomato’s growth story, the sales increased by 225% in the first half of FY2020. As per the company’s biannual survey, sales were USD 205 million in the first half of this year, up from USD 63 million the previous year.