Swiggy bags $2M from Accel, SAIF to deliver food to Bangaloreans in 35 minutes

Food ordering and delivery app Swiggy has raised INR 120 million (US$2 million) from Accel Partners and SAIF Partners.

Swiggy app accepts orders from users and has 150 delivery personnel who pick-up the food from restaurants and deliver to customers. The app is powered by routing algorithms to create an efficient delivery system. It currently works only in Bangalore but is gearing up for expansion.

“We plan to use the current funding for expanding into Mumbai, New Delhi, and Chennai,” says Sriharsha Majety, founder of Swiggy. He is a graduate of Birla Institute of Technology & Science (BITS) Pilani, one of India’s top engineering colleges.

Swiggy is betting on their system of timely deliveries and service levels to capture the online food delivery market in India. The firm promises to deliver in 35 minutes in these infrastructure and logistically starved cities.

“We do not have a minimum order policy on any restaurant. The ownership over the delivery fleet ensures reliable and fast deliveries as our delivery boy only carries one order at a time,” says Majety, who founded the company along with Nandan Reddy, another BITS Pilani alumnus, and Rahul Jaimini, an Indian Institute of Technology (IIT) Kharagpur grad.

The seven-month-old startup claims of having fulfilled over 30,000 orders so far.

Food startups have been hot in India this year. Rocket Internet-backed Foodpanda recently acquired local rivals TastyKhana and Just Eat to expand faster inorganically. Food discovery service Zomato, which is on a global expansion spree, has now turned its attention to diversifying into food delivery as well.

Another heavily funded startup in the space is location-based food ordering service TinyOwl, which has raised US$20 million in several rounds from Matrix Partners, Sequoia Capital, Nexus Venture Partners, and a few angel investors. However, none of these companies take the onus of delivery.

“Getting food delivered expeditiously is a huge problem in India. The Swiggy team fills this need,” says Anand Daniel, partner, Accel Partners.

More niche food startups like iTiffin, Yumist, and TapCibo, which recently raised seed funding, are also booming. Unlike Swiggy, these three startups deliver food cooked by their own chefs instead of relying on restaurants. Most of them position themselves in the healthy food space.