Mumbai-based food ordering app, TinyOwl has raised an amount of Rs.50 crore from its existing investors Sequoia Capital and Matrix Partners.
With the new fund, the company will be focussing on creating a sustainable business in the food-tech domain. As per TinyOwl’s CEO, Harshvardhan Mandad, the company currently is in the middle of restructuring process looking to control burn rate and outsourcing deliveries, so as to help optimise their resources and cash in a more effective manner.
The raised funding will be used to create a viable business model that everyone is looking for, said a source directly related to the matter. TinyOwl closes 7,500 orders on an average per day.
Further adding, Mandad said, From the last few months the company has been outsourcing its last mile delivery to partners such as Roadrunnr, Opinio and Shadowfax. This significantly helped us to solely focus on our core technology and processes along with helping us significantly cut down the delivery costs. With this step the costs came down by 43%.”
In August 2015, there were rumours of Foodpanda acquiring TinyOwl. Neither Foodpanda nor TinyOwl have confirmed this as of now, when iamWire team met Saurabh Kocchar in June earlier this year he said that these (food tech) startups are bringing in fresh competition and they had no plans of acquiring TinyOwl or any other food tech startups as of then. In February 2015, TinyOwl raised an amount of $15 million in its series B round led by Matrix Partners with participation from existing investors Sequoia Capital and Nexus Venture Partners.
Talking about the online food ordering sector’s growth till now and future scope, the source from the company TinyOwl mentioned that this space has been garnering a lot of investor interest since quite a while now. However, the betting model which will have 2 to 3 players who will lead the queue with one winning player of the lot can not be known. Since this space is promising growth and is reliable, many new players are entering the segment. But nobody can predict who will the winner be, and even the investors do not know who to bet upon.
As per the industry analysts, the winning players will make the entire segment profitable, thereby creating profitable business.
According to the report published by iamwire the food startups sector holds a positive potential. The trend will increase in future but there will be cut throat competition among the players in this segment. The question, ‘who will survive’ is a little tricky as the one who maintains its logistics well, will rise. In any company logistics play a huge role.