October 13, 2020
Why We’re Investing in Zomato
We are excited to partner with Zomato, the leading online food delivery (OFD) platform in India, as they raise growth equity to help accelerate their vision of providing better food to more people.
Since its founding twelve years ago in Delhi, Zomato has built an impressive platform spanning OFD, online restaurant reviews and reservations, and a sourcing business to help restaurants improve the quality and security of their food supplies. Last year, 40 million customers across 500 cities in India ordered from Zomato’s OFD service, together placing 400 million orders worth approximately $1.5bn in value.
To put this execution in context, Zomato is now one of the largest internet platforms in India as measured by orders and one of the most engaging platforms as measured by monthly order frequency, on par with e-commerce and ride-hailing companies:
While this execution is impressive, we believe there is much more to come. In our experience investing across emerging markets, we have found that providing a high-quality service in high-frequency categories such as food and apparel creates powerful customer habituation and loyalty. With 700 million active broadband subscribers in India, of which 500 million have come online only in the past four years, Zomato has many more mouths it can feed.
Having known them for years, we are confident that co-founder and CEO Deepinder Goyal and his team of food lovers and technologists at Zomato are very well positioned to pursue this massive opportunity, and we are excited to be alongside them in this pursuit. The current COVID-19 pandemic serves as a stark example of unexpected challenges that may come along the way and the adaptability that will be required to manage through them. We trust the team to respond ethically and proactively during these challenges, as they have this year, for example by distributing over 70 million free meals and instituting a contactless dining program to keep diners and restaurant workers safe.
We are excited to see what the future of food brings in India; whatever it may be, we believe Zomato will continue to lead the way.
Disclosures
The information presented in the above post is provided for informational purposes and is intended to provide an update concerning Kora Management LP (together with its affiliates, “Kora”) and an investment made by one of the funds Kora manages (the “Fund”) and does not constitute an offer to sell or the solicitation of an offer to purchase any securities, including those of the Fund. Any such offer or solicitation may be made only by means of the delivery of a confidential offering memorandum, which will contain material information not included herein regarding, among others, risks, and potential conflicts of interest.
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