Swiggy is one of India’s most successful startups. This Foodtech startup has registered its name in the list of Unicorns (startups with a valuation of more than $1 Billion) in less than four years only, becoming the fastest startup to become a unicorn in India.
Team & Story
In 2013, BITS Pilani graduates Sriharsha Majety and Nandan Reddy worked together and founded Bundl Technologies, it was a logistics and shipping startup for small and local sellers retailing on e-commerce platforms such as Flipkart and Amazon India.
Time flew and Rahul Jamini (An IIT Kharagpur alumni and Former Myntra software engineer) came into the picture.
After many brainstorming sessions, the trio decided to shelve Bundl and, instead, attempts to crack the food-delivery space, which in their eyes was ripe for disruption. The trio worked together and founded Swiggy in August 2014 in the Bengaluru neighborhood of Koramangala, keeping the basics of Bundl but focusing on hyper-local food delivery.
After the launch, Swiggy had onboarded many restaurants to the platform. They followed the basic principles to be a success, i.e. to deliver the food to the customer in time with no minimum order policy. What made them different from the competition is their investment in building a correct logistics network with a huge fleet of their own delivery executives, which at that point in time is something that no other online food ordering startup in India had ever done. Swiggy mainly is concentrated on customer experience and transparency with merchants (restaurant partners). Swiggy started making good returns and made big changes in the food delivery business.
Swiggy became the only consumer internet startup from the 2014-2015 hyper-funding rain that continues to thrive until now. That wave was supposed to produce many successful companies and a couple of unicorns too; but when the dust settled, only Swiggy succeeded. Along the way, Swiggy has beaten both far older companies, like Zomato and Foodpanda, also as peers, including Tinyowl, which eventually collapsed and acquired by Roadrunner and then Zomato.
In 2015, After seeing their business and revenue model working seamlessly, many investors got interested in funding the startup and Swiggy received its first funding of $2 Million (April 2015) from Accel and SAIF Partners. In the same year, the two VCs again funded the startup $16.5 Million (June 2015) along with Norwest Ventures Partners. Now the startup had over 100 restaurants onboard and was delivering over 70,000 orders on a monthly.
The internet funding boom that started in mid-2014 collapsed dramatically 18 months later. The bubble burst and several startups started shutting shop. The food delivery space was particularly hit hard. TinyOwl (a competitor in the food tech space for Swiggy) lost its presence and got merged with Roadrunner (a logistics platform) to make Runner and further got acquired by Zomato within few months. Soon the funding was exhausted and Swiggy was no exception and it was experiencing severe losses and hence, the year was spent on cutting costs and strengthening its logistics network.
Like every startup or business, Swiggy also had its share of ups and downs. With a bit of outsourcing and tying up with third-party logistics, players had also begun to further the efforts of building a sustainable network. The efforts started paying off and Swiggy managed a growth rate of 20-25% each month. With over 5000 restaurants partners and 3000+ delivery boys, Swiggy has his roots strengthened.
In 2016, the platform had caught the eyes of some global investors including Singapore- based RB Investments and New York-based Harmony Partners, and raised $35 Million (Jan 2016) along with existing investors Norwest Venture Partners, SAIF Partners, and Accel Partners. In May 2016, Swiggy Raises an additional Rs 47 Crore from existing investors Norwest Venture Partners, DST Global, and Accel Partners at a valuation of $130 Million. Again in September, US-based venture capital firm Bessemer Venture Partners leads a new funding round of $15 Million for the company.
May 2017, Naspers led an $80 Million funding round into Swiggy. At the same time, due to its excellent customer service, the order volumes continued to grow. Swiggy also stood out from the pack because of its strong restaurant partnerships, user-friendly easy-to-use app, new bets, and experiments with projects like “cloud kitchens”- a program that permits its restaurant partners to line up kitchen spaces in areas where they don’t operate. Now the company has 12000 restaurants on its platform and with 13000+ delivery executives; Swiggy was serving 5 Million orders monthly. In Sept 2017 the Founders appoint Rahul Bothra (Former Olam International Executive) as its first chief financial officer. And took many major decisions and lunched services like:
• Swiggy Capital Assist – This gives collateral-free loans to restaurant partners.
• Swiggy Access – This was the first virtual kitchen facility for existing restaurant partners. It will act as a central base for delivery with five kitchens of different restaurants launched.
• Launches Swiggy POP – This offers a curated menu of single-serve meals in the range of Rs 99 – 200 from neighborhood restaurants.
• Swiggy Scheduled – This allows users to plan and order their meals in advance.
In March 2018 South African media giant Naspers leads an investment of $100 million in Swiggy along with new investor Meituan Dianping. Swiggy launches its operations in Jaipur by roping in over 300 restaurants in the city and forays into Coimbatore after beefing up presence in Chandigarh, Jaipur, and Ahmedabad. Now Swiggy has a fleet of over 20,000 delivery persons and over 25,000 restaurants across 12 cities listed on its platform.
By June it reached 14 million monthly orders and raise $210 million in new capital for expansion from existing investors Naspers, and new investor DST Global at the valuation of $1.3 billion, making it the fastest company in India’s food-tech space to achieve the unicorn status.
In July 2018 Dale Vaz (former Amazon executive) appointed as the head of engineering and data sciences. And, in August 2018 it Acquired a Mumbai-based on-demand delivery firm “Scootsy” in an all-cash deal for an undisclosed amount. By, Sept 2018 Swiggy expands to new cities, including Dehradun, Puducherry, Mysore, Vijayawada, Nashik, Guwahati, Kanpur, and Ludhiana, with over 1,200 restaurant partners.
In Dec 2018 Swiggy raised the biggest ever funding round in the country’s food-tech sector with $1 billion fresh capital from existing and new investors such as Naspers and Tencent Holdings at the valuation of the company at about $3.3 billion. Quite recently, Swiggy managed to acquire funding from its major investors and managed to raise $43 Million. Swiggy had been valued at an all-time high of $3.6 Billion bringing to light the perseverance and efforts of the Swiggy family.
Taking a step ahead to more recent times when the pandemic wasn’t such a prevalent fear among the common people, Swiggy had surpassed its 2020 target of delivering 320 million orders a year with over 500 million orders a year. With constant developments in their technology, Swiggy has made sure it has secured the number one position in the country in the online food ordering business.