In a season that would be remembered for depressed funding, depressing recession fears, and COVID-19, we have picked good vibes from the startup industry in India. Two funding news made the first “good” blow on Monday. Zomato and Swiggy, the leading FoodTech startups have received a new lease of financing from investors. Swiggy raised $43 million in Series I funding, taking its total funding to $156 million. It is currently evaluated at $3.36 billion.
Its closest rival – Zomato, evaluated at $3.35 Billion, raised $5 million from Pacific Horizon Investment Trust.
Earlier this year, Zomato raised $150 million. Swiggy had raised $113 million in January. In addition, Zomato had also acquired another FoodTech company UberEats India, taking its total market share to 55%.
The funding comes at a particularly difficult times for FoodTech companies. Amidst lockdown due to COVID-19, the daily food delivery orders have dropped to below 1 million in the last 3 weeks.
“As we continue to strengthen and expand our services that offer unparalleled convenience to our consumers, we are humbled by the faith shown by our investors year-on-year and welcome the new investors on board. Our focus remains to execute on our vision while building a sustainable path to profitability.”
Zomato also plans to build on its diversification to online grocery ordering and delivery during the lockdown, ahead of the latest funding round. Zomato Market launched to serve customers ordering very essential commodities, could be competing with Siwggy’s grocery platform- Swiggy Stores.
In March, the Indian government declared a 21-day lockdown to fight the COVID-19 pandemic. Knowing it will affect the chain of supplies and daily earning of millions of food outlets, delivery staff and others in the system, Swiggy announced the unique “Swiggy Hunger Savior COVID Relief Fund.”
Sriharsha Majety, CEO at Swiggy said –
“This Swiggy fund will be used for the welfare of our delivery fleet and their families, with primary contributions being made by Swiggy’s founders, senior leaders, employees, and investors. As a start, Swiggy’s CEO has committed 50% of his annual salary towards this fund. Swiggy had also committed all its revenues from 22nd March – the day of the Janata Curfew – towards this purpose. As of date, we have already raised Rs. 4 cr (USD 526039) towards the fund; our aim is to raise a total of Rs. 10 cr. (approx USD 1313715)”.
SWIGGY already leads in bringing tech to the user’s fingertips. It announced contactless deliveries from 19 March to prevent the spread of COVID-19 and ensure 100% hygiene.
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