Brief: Food startup Swiggy scoops up $80m, defying cooldown

Photo credit: lenyvavsha / 123RF.

The news:

• Food delivery startup Swiggy has raised US$80 million in a series E funding round led by South African media company Naspers, bringing the Indian startup’s total funding to about US$155 million.
• It plans to make significant investments in technology, including automation, data sciences, machine learning and personalization.
• Other investors include Accel Partners, Bessemer Venture Partners, Harmony Partners, RB Investments, Norwest Venture Partners, SAIF Partners and Apoletto.
• Among home-grown food tech startups, only Zomato’s war chest is larger. It has raised a total of US$224 million.

Why it matters:

• Last year, food tech startups in India were going through a tough time. Funding into the sector had hit a 5-year low. Several smaller startups shut shop, while even giants like Zomato were forced to lay off staff.
• A substantial round like this proves there’s still investor confidence in the food delivery segment.
• Food deliveries in emerging markets tend to have low profit margins. But Swiggy has told Tech in Asia last year that it’s experimenting with in-house cooking, which is potentially a higher margin business.

Source: Livemint