Travis Kalanick, former CEO of Uber and co-founder of CloudKitchens, raised concerns about the profitability of cloud kitchen ventures in markets like India.

At the 2025 Moonshot Summit, he said, “You can’t make money on cloud kitchens in India. Don’t go to Indonesia, don’t go to India, don’t go to Colombia.”

Kalanick also shared his vision for cloud kitchens, highlighting their potential to provide convenience and save time for consumers.

He mentioned the importance of developing new models that leverage AI for practical applications in the industry.

CloudKitchens launched its India operations, KitchenPlus, in 2019 but ceased operations in 2023 due to unsustainable revenue growth and high costs.

🔗 Source: The Economic Times

🧠 Food for thought

1️⃣ Aggregator economics create significant headwinds in price-sensitive markets

Travis Kalanick’s candid assessment about cloud kitchens in India aligns with the challenging unit economics revealed in industry data.

Cloud kitchen operators in India typically surrender 20-30% of their revenue to food delivery platforms like Swiggy and Zomato, significantly eroding already thin profit margins in a price-sensitive market 1.

This dependency on aggregators creates a fundamental challenge when combined with India’s lower average order values, explaining why nearly 50% of cloud kitchens in major Indian cities are deemed unprofitable despite the growing market 2.

The economics are particularly challenging for international entrants like Kalanick’s KitchenPlus, which struggled with higher-than-average rental and utility costs before closing in 2023, highlighting how local cost structures can make or break cloud kitchen ventures.

Market saturation has intensified competition, with many cloud kitchens offering similar menus and fighting for the same customer base, further compressing margins in an already difficult operating environment 3.

2️⃣ Successful players pivot to hybrid models while pure-play delivery struggles

Despite Kalanick’s warning, India’s cloud kitchen market is projected to grow from $400 million in 2019 to $2-3 billion by 2024, but the path to profitability is proving elusive for pure delivery models 4.

Leading operators like Rebel Foods (operating over 450 kitchens across India) have begun establishing physical outlets to complement their delivery services, recognizing the limitations of the delivery-only approach 4.