Many big companies are now seeing the potential in the online food delivery market in India and are investing heavily in relevant companies, for instance: Swiggy.
According to Economic Times (ET), Global technology hedge fund Coatue Management, along with a few others, will be investing $50 – $100 million US dollars in Swiggy.
Additionally, China’s Meituan-Dianping could potential also invest in Swiggy again after a mammoth amount it just put into the pocket of Swiggy 2 months ago.
In February, Meituan, along with South African media giant Naspers, had just shelled out $100 million for Swiggy. Beijing-based Meituan is the second largest online food ordering and delivery service in China.
Read more: Meituan-Dianping Invests in Indian Food Delivery Company Swiggy
Founded in 2014, Swiggy, a food ordering and delivery platform headquartered in Bangalore, India, aims to “change the way India eats. With a current operational fleet of 20,000 delivery persons, it delivers food across 12 cities; which include New Dehli, Gurugam, Mumbai, Pune, Kolkata, Bengalum, Hyderabad, and Chennai among a few others; from over 25000 restaurants.
The large investment made by Coatue, Naspers and Meituan and the talks of further investments into Swiggy, underlines the recurring increasing rate of investment in India’s digital market.
The landscape of India’s consumer market is changing, especially with regards to getting a bite. “An increasing number of consumers are relying on online food ordering platforms like Swiggy for their food and beverage (F&B) needs,” PhonePe Head of Business Development Pradeep Dodle said.
Swiggy’s valued at $700 million US dollars last month, according to ET, citing financial documents sourced from data research platform Tofler.
Recently, by partnering with Flipkart’s arm PhonePe, Swiggy has enabled new simplified payment options for its customers. Customers are introduced to PhonePe wallet, UPI, and paying through the Swiggy app to pay for their orders as payment options.
Swiggy uses privately-run ICIC bank to allow for digital payment by its delivery fleet. Cash-on-delivery has been the major form of payment on the platform Swiggy, therefore, by leveraging on ICIC bank’s capabilities, through the use of Unified Payment Interface (UPI)-based solution for instant fund transfer and automated cash deposits at ICIC Bank branches and ATMs across India, has increased efficiency of the delivery fleet. This hassle-free way of transferring funds saves the delivery fleet’s time as they make a quick fund transfer to Swiggy, as well as save on distance traveled.
Swiggy would have to strengthen its foothold in the online food delivery business as it competes with Ant Financial-backed Zomato, besides new entrants like Softbank-backed Ola and UberEATS, to secure its current lead over Zomato, with 35-38% in market share as compared to Zomato’s 25-30%, according to Livemint as cited from RedSeer Consulting, an internet-focused consultancy in India.
With Meituan-Dianping’s recent investment in Swiggy and Ant Financial’s backing of Zomato, it seems that the China giants are bringing over their battle from China and waging war in Indian territory. And in addition to just pouring money, the Chinese tech moguls could also lend their advanced technologies and experience to local food tech startups to bolster their growth.