Close on the heels of Series C, Swiggy raises Series D funding of $15m from Bessemer Venture Partners
In the times when there are talks of funding slowdown in higher rounds, Swiggy, the online food-delivery platform, announced that it has raised Series D funding of $15 million led by Bessemer Venture Partners. This round of funding comes within nine months of its Series C funding of $35 million from Singapore-based RB investments and New York-based Harmony Partners.
Existing investors Norwest Venture Partners, SAIF Partners, and Accel Partners also participated in this round.
With this additional $15 million, the total funds raised by Swiggy stand at $75.5 million.
Swiggy will now be looking at improving its customer relationship experience, better technology upgrades, wider spread of restaurants, and better delivery efficiency.
The team will now continue to focus on consolidations and capturing a larger share of the market. Since its Series C funding, the team has brought in senior leadership and VPs across different functions like product, HR, finance, design and marketing.
As of April this year, the team was growing at 25 percent month-on-month. Swiggy has over 5000 restaurants on its platform and 3,000 delivery boys. According to the RoC data filed by the company, the net worth of the company is Rs 3,86,34,590 and the turnover is Rs 7,41,702. (The definition of Turnover according to RoC is: “Turnover” means the aggregate value of the realisation of amount made from the sale, supply or distribution of goods or on account of services rendered, or both, by the company during a financial year)
After the Series C funding, the team had intended to add on ‘Swiggy Express’, an in-house platform offering chef-made meals in less than 20 minutes. It also offers customers an option to pre-order meals. Swiggy had also introduced Surge Pricing in May this year.
Talking about Swiggy Express, Sriharsha Majety, Co-founder and CEO of Swiggy, said that the quality of food here is different, part home-style, part gourmet. The team is looking to expand by broadening the availability and variety and even shortening the delivery time to 20 minutes. “If the pricing, food, and delivery can be scheduled the model can work,” added Harsha. Swiggy Express currently is in a pilot phase in parts of Bengaluru.
Vishal Gupta, Managing Director at Bessemer Venture Partners, adds that Swiggy’s full stack approach with a great execution has given unparalleled customer experience, retention, and great business economics. In a press statement, he said,
“We look forward to working with Sriharsha and the management team as they further cement Swiggy's leadership position in the India market.”
Speaking of this round of investment, Harsha added that their growth in the past few months show that customers are becoming accustomed to a new behaviour of online food ordering for the experience than just convenience.
“Our vision is to change the way India eats and we want to be the top of mind recall for the users for all their four meals a day,” says Harsha.
Over the past few months, foodtech and food businesses have got a cold shoulder by investors. Towards the end of last year and the beginning of this year, several foodtech platforms faced problems. TinyOwl, which at one point in time was pegged as a strong competitor to Swiggy, saw a massive downward spiral.
However, this is Swiggy’s second round of investment in this year. Indian consumers, especially in the metros, are increasingly relying on 'non-home cooked' food, which has given rise to the new crop of food tech startups, who are offering everything from fresh meals prepared by home chefs to home-delivered ready-to-cook ingredients, apart from doing restaurant deliveries.
While the demand is there -- food services is estimated to be a $50 billion market -- issues of scale plague this sector. However, Swiggy’s investors seem to be very bullish about the company.
Sumer Juneja, Director Norwest Venture Partners, also believes that food delivery is about delivering within 35 to 40 minutes. He adds that if you are unable to do so, then the company isn’t solving a consumer problem.
“So when you are growing you need to control delivery. If I can get food from close to 10,000 restaurants in 30 minutes, then you are truly offering great service and value,” says Sumer.