The New Year begins on a better note for foodtech with FreshMenu raising Rs 110 crore
Bengaluru-based FreshMenu has raised a new round of funding of Rs 110 crore from Zodius Capital, with participation from existing investor LightSpeed Ventures. Rashmi Daga, Founder of FreshMenu, says this round of funding will be used for team building, growth and strengthening of the brand.
“We will be adding newer kinds of food and cuisines to the menu. We are also upping the technology ante in terms of our new app and web experience. There will be more focus on Delhi and Mumbai, now that we have around 17 kitchens in Bengaluru,” adds Rashmi.
Started in 2015, FreshMenu follows a hub-and-spoke model with centralised kitchens in each area that they move towards. From January last year, the startup had begun opening kitchens every month. The team records a month-on-month growth of 30 to 40 per cent.
After seeing a downward trajectory in the space at the end of 2015, this investment in FreshMenu brings in an added push to the speculation of how foodtech startups will fair this year. Apart from FreshMenu, there have been two other deals in the foodtech space this year, one of an undisclosed amount by WIMWI, while B9 Beverages raised a Series A of $6 million from Sequoia Capital.
If you look at the amount of funding made in the foodtech space in the month of April 2015, it was a whopping $74 million on a total of seven deals. In August 2015, this dipped to $19 million with a total of five deals. In September, the number further dropped to two.
The end of 2015 witnessed Dazo and SpoonJoy shutting operations, and questions were raised on the foodtech space. Additionally, the news of laying off employees and difficulties over at TinyOwl had those speculations going further.
Sumer Juneja, Principal, Norwest Venture Partners, believes that unless you create a solution for a problem consumers face, they don’t buy into the product. He adds that, however, if the model is right, investments will flow in.
It is too early in the day to say if the investments will drop of further increase in 2016.