Foodtech companies seem to be back in favour with investors who are backing them with plenty of growth capitalSuma Ramachandran
Foodtech startup Box8 finalised an agreement to raise $6.2 million in a Series C funding round from ReDefine Capital earlier this month. The startup's filings with the Registrar of Companies show that it will receive the amount in tranches.
Box8 began life as Poncho in 2011, serving Mexican food in the quick service restaurant format but expanded its menu and rebranded to its current name in 2014. Founded by IIT alumni Amit Raj and Anshul Gupta, the company prepares and delivers meals and snacks using its own delivery fleet across Mumbai, Bengaluru, Gurugram, and Pune.
In May 2017, the company had raised Rs 7 crore (a little more than $1 million) in venture debt from Trifecta Capital. Prior to that, in October 2016, it had raised Rs 50 crore in a Series B round from IIFL Seed Ventures, and Mayfield. At the time, the founders had said they were looking to expand to Hyderabad and Chennai.
Yesterday, Box8 also announced a 'watch live' feature via its Twitter feed. The video uploaded shows that customers can get a live video feed from when their meal is packed to when it is delivered to them.
After a shaky period in 2015-16 when many foodtech startups closed down, the sector has been back in favour with investors, who are backing the survivors with growth capital.
Earlier this month, Faasos' parent company raised $15.8M from Sequoia Capital, Lightbox Ventures, and Evolvence India in a Series D1 funding round, close on the heels of raising $4.2 million in venture debt from Trifecta Capital.
In January, Box8 rival FreshMenu raised $2.94 million from Lightspeed Venture Partners, Zodius Technology Fund, and K. Ganesh's fund GrowthStory.
Foodtech giants Swiggy and Zomato had raised massive rounds of funding in 2018, with Swiggy closing the year with a $1 billion Series H round led by Naspers, Meituan Dianping, Coatue Management, DST Global, Tencent, Hillhouse Capital, and Wellington Management company.
Last month, its rival Zomato raised $40 million in funding led by US-based private investors Glade Brook, as a part of a larger $1 billion round it is raising from existing investor Ant Financials and new investors. Last year, Zomato announced its entry in the B2B foodtech space by acquiring TongueStun, a Bengaluru-based online caterer and office canteen aggregator.
Even hospitality bigwig OYO tried out a foodtech experiment. O'Biryani by OYO was reportedly a pilot focussed on utilising its existing kitchen space.