Zomato invests in food delivery startups Grab and Pickingo, also partners with Delhivery

Food delivery seems to be a hot segment at the moment. To spruce up its delivery process, online restaurant directory and food ordering, Zomato has made strategic investments in Gurgaon-based Pickingo, and Mumbai-based Grab, both hyperlocal delivery players, to enable last-mile delivery for restaurants, including dine-in-only restaurants that don't otherwise deliver.

Zomato has also partnered with digital commerce focused logistics venture Delhivery. Importantly, it is also worth noting that with this partnership, Delhivery is also ushering towards hyperlocal delivery segment.

Founded by Jignesh Patel, Nishant Vora and Pratish Sanghvi in 2012, Grab is a food logistics firm. The company secured $1 million from Oliphans Capital and independent investor Haresh Chawla. Pickingo is a B2B on-demand hyperlocal logistics startup that earlier snapped up $1.3 million led by Rehan Yar Khan of Orios Venture Partners.

Deepinder Goyal, Founder and CEO of Zomato, said,

We have unequivocally the largest restaurant base in India and and we will work closely with Pickingo, Grab, and Delhivery to improve the last-mile delivery experience for users placing orders online on Zomato. So far, restaurants have been delivering on their own, but with this partnership, we will also be able to target restaurants across the country that don’t otherwise deliver. We are also launching our online ordering service in Dubai, Australia, and South Africa later this month. Along similar lines, we are also in conversation with hyperlocal logistics firms in other countries to ensure that we are able to provide a seamless and quality experience to our users there.

Rahul Gill, Co-Founder and CEO, Pickingo, said,

This investment will not only infuse funds into the company but will also allow us to scale rapidly with Zomato's online ordering business, while also leveraging Zomato's strong relationship with restaurants across the country. We have already started working together to deliver from select restaurants in New Delhi, and we look forward to taking this partnership further.

According to Pratish Sanghvi, Co-Founder and Director, Grab, last mile logistics is a challenge for most merchants across India, especially restaurants, and the company views this investment as a great opportunity to solve this problem using technology along with Zomato.

Zomato is making strides to move from being a search and discovery portal to a platform offering technology that helps merchants connect more effectively with customers with the launch of online ordering, cashless payments, soon to be launched table reservations, and a point of sale system.

Sahil Barua, Founder & CEO, Delhivery, said,

The food-tech space in India is heating up, and we’re excited about this partnership with Zomato. Delivery logistics for restaurants have always been a challenge, and we believe the technology-first approach will help simplify operations for them, as well as enrich customer experiences.

Over the past one year Zomato has acquired nine companies to further extend its global reach in the restaurant search space. This includes the acquisition of Urbanspoon, which gave Zomato a dominant position in Australia, Canada, and the United States.

YourStory’s take

Partnership with Delhivery and investments in Pickingo and Grab make a lot of sense for Zomato which is ramping up its delivery networks for restaurants aggressively from quite some time. Grab will power delivery of restaurants listed on Zomato in Mumbai while Pickingo will do the same in Gurgaon and adjacent NCR region.

In the near future, we may see more strategic investment or acquisition of hyperlocal delivery networks in different cities by Zomato. Also building a nationwide delivery network is a time consuming task and instead of doing this, Zomato will eye more such partnership and investments.

Interestingly, with Zomato partnership, Delhivery is venturing into food delivery segment. Of late, Delhivery was only catering to e-commerce and started processing small volumes of hyperlocal delivery this year. Food delivery requires altogether different skill sets and infrastructure. Going forward, it would be interesting to watch how Delhivery's foray in food delivery fares.