“Creative thinking lead to great business ideas”. One such similar story is of the online food delivery company Zomato.
The restaurant search service started as Foodiebay and changed their name from Foodiebay to Zomato in 2010.
Zomato started as a restaurant search platform. Now they also provide online food delivery service to its customers.
- Where did the idea of Zomato come from?
Deepinder Goyal and Pankaj Chaddah were working at Bain. They got the idea of starting a company like Zomato when they saw a long line in the office canteen for the menu card.
They wanted to find a solution to this problem. This is how Foodiebay was born. Foodiebay scanned the menu of the restaurants and posted it on the private network of the company.
Foodiebay started as an intranet facility. After the success at the office, they opened the service to the public.
Foodiebay started gaining more popularity day by day. The number of users and clients also increased gradually. That’s when they decided to change the name from Foodiebay to Zomato as they wanted to avoid confusion with popular e-commerce company eBay.
- Zomato Funding:
The website of Zomato was getting a good amount of traffic. The website was doing well. But they had to keep up with the times and develop an app soon. Unfortunately they did not have enough funds to build a mobile application.
Zomato needed funding and that’s when Sanjeev Bikhchandani of Naukri.com stepped in to save the company. He was fascinated with the company’s ideas and he invested around $ 1 million.
Presently, Zomato has raised a total of $755.6 million in funding over 13 rounds. Their latest funding was raised on March 1, 2019 from a corporate round.
- Zomato Business Model:
Key Activities of Zomato:
- Provides restaurant search service.
- Online food delivery service.
- Provides restaurant ratings and reviews.
- Collects data on food menus, contact and location of restaurants to provide relevant information to users.
- Bridges the gap between consumers and restaurants through efficient technology which saves time and cost.
- Users who use the app to find restaurants and various cuisines.
- Customers who order home.
- Restaurants who want to reach out to their target audience.
- Market research companies.
- Database companies.
- Mobile App
- Advertising – Advertising on their website and app generates a significant amount of revenue.
- Food delivery – Home delivery of food that is ordered online.
- Subscription – Subscription of Zomato gold.
- Commission – Cut from online and offline orders from their side. They charge anywhere between 5% – 20% of the order value.
- Consulting – Provides business consulting and data analytics services to their clients.
Zomato’s success did not happen overnight. They created a business model which played a major part in building the brand it is as of today.
Zomato has grown extensively from 2008 and has come a far way. They have their presence in more than 500 + cities and aim to grow even bigger.
Zomato has always catered to the needs of their customers. This is one of the main aspects that has helped them grow.
This is just the beginning of their success story. If they continue with this kind of hard work, dedication and innovation, the company has the potential to make it really big.