TinyOwl shuts down as India sours on food startups. But it will live another day

Harshvardhan Mandad, CEO and cofounder TinyOwl. Photo credit: Super Personal Recruiter via YouTube image grab.

Food ordering startup TinyOwl is shutting down, the startup announced today.

The news comes as India’s consumers are turning sour on food startups. Uber arch-rival Ola shut down its food and grocery delivery service earlier this year, while the Yelp-esque Zomato saw lay-offs as its CEO complained of profits of as little as US$0.20 on some food orders.

TinyOwl laid off some staff late last year. The startup made national headlines in November when angry staffers briefly took co-founder Gaurav Choudhary hostage as tempers frayed over job loss settlements.

Harshvardhan Mandad, TinyOwl’s other co-founder, today admitted to Medianama the startup has opted to merge operations with hyperlocal delivery company Roadrunnr. The merged company will be called Runnr once it launches later in the year.

“We will be live only in a few localities in Mumbai and will decide on the future course of action once our merger is complete,” TinyOwl CEO Harshvardhan Mandad told Tech in Asia this afternoon.

Other cities have been shut down for TinyOwl, and only 20 localities in Mumbai will remain live.

“We may again start online food deliveries in other cities once the merger is complete,” he added.

The name TinyOwl is likely to vanish in the coming weeks. “We may want to give it a new look and feel. Thus we might decide to operate under Runnr’s brand,” said Harshvardhan, who will be moving to the new entity.

Photo credit: Your Coastal Bend.

Runnr is owned by Bangalore-based Carthero Technologies, with Roadrunnr’s two co-founders as directors.

Both TinyOwl and Roadrunnr were out to raise fresh funds this year, but to no avail. The former has cash left to survive only till December, revealed Harshvardhan.

Bigger fish

The merger makes sense for both parties, which compete with larger and well-funded companies in India such as Swiggy and Zomato in online food ordering and delivery.

Runnr hits the road