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The result – a significant 58% jump in ad revenues.

Further, its focus on enhancing the efficacy of its sales team led to over 83% growth in
productivity (revenue/headcount) in the ads business.

Launching Zomato Infrastructure Services

Newer initiatives too did their job in ramping up growth. For instance, the platform’s new
initiative for cloud kitchen services through Zomato Infrastructure Servicesand efforts to scale up
food ordering delivery along with table reservations gave the company an 8x surge in food
ordering revenues. More so, the focus was increased on user onboarding, experience, and
retention along with restaurateur experience and real-time payment settlements. This is what
helped in hitting 2.1 Mn monthly order volume in March while keeping unit economics positive.

The food ordering business – which contributes 20% to the company’s top line – is currently
present in 13 Indian and three Middle Eastern cities. Interestingly, this makes Zomato one of
the few Indian unicorns to have a global presence. While last year, it had rolled back
operations from nine countries, it will be launching soon in Beirut. Outside of India,
Melbourne, Dubai, Lisbon, Auckland are strong markets for Zomato.
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Zomato is also banking on its cloud kitchen which rolled out in Delhi NCR recently. With this
service, the company will create kitchen spaces in areas where there is a lack of good
restaurants. Under the service, partnering restaurants will prepare and deliver food
exclusively for Zomato through these kitchens.

Table Reservations

The Table Reservations product was launched in July 2016 where users could book tables
via the Zomato app and website. This comes after Zomato acquired Nextable, in April 2015.
Currently, Zomato offers the table reservation option across24,000 restaurants in 12
cities. In the month of March, it claims to have seated 600K guests via the table
reservations product.

Zomato Gold

In March 2017. it also launched a premium membership programme, Zomato Gold, in


Lisbon and Dubai. The programme will be rolled out in India around June with Delhi,
Mumbai and Bengaluru being the initial stops. Simply put, it is a membership programme for
a premium nightlife experience in the cities of Dubai and Abu Dhabi, allowing users to have
an affordable experience. For this, it has partnered with 200+ restaurants, bars, and
lounges, so far.

Zomato Base

Another product it is banking on is the Point of Sale (PoS) product Zomato Base, which
is undergoing paid beta trials at over 200 restaurants. It is expected to see greater
uptake this year across India, UAE and beyond. Zomato Base is an Android-based POS
system that helps a restaurateur manage day-to-day operations from a single platform. It
offers a variety of features for including menu, recipe, and inventory management, a built-in
payment solution that accepts debit and credit card payments, CRM, and real-time
analytics.

Zomato, meanwhile, faces tough competition in the food ordering space


from Swiggy among a clutch of competitors which include Foodpanda and Runnr. As per
a Mint report, the company’s filing with the Registrar of Companies showed that Swiggy’s
cash burn stood at around $2 Mn (INR13 Cr) per month in FY16.

Space is marred with high customer acquisition costs. Deepinder, however, allays these
fears by ending with his oft-repeated quote – “We are only 1% done”. It will be interesting to
see Zomato’s remaining 99% as the battle in the food ordering space further intensifies.

A Glimmer Of Hope

Zomato’s financials come a day after another Indian unicorn InMobi also declared that it has
become profitable. However, despite the high market opportunity, Indian consumer internet
companies are still struggling to generate revenues and become unit positive. In February,
Mint published a report on the financial health of 41 consumer Internet companies in
India.

According to the report, Flipkart leads the charts, accounting for 75% of the clubbed
revenues of all, but only 46% of the total losses, for the financial year ending March
2016. Snapdeal, Paytm, ShopClues, followed Flipkart to mark the second, third and fourth
position on the ladder, respectively. Sector-wise, as expected, ecommerce rules the
industry, amidst eight other sectors including health, auto, hyperlocal, services,
finance/insurance, real estate, travel and messaging service.

Hence, profitability and attaining positive unit economics still remain sore points for most
hyper-funded consumer internet businesses. In 2016 alone, 50 startups in the foodtech
space raised $152.3 Mn in investor funding, as per Inc42 Datalabs. The year also saw
over 37 shutdowns of foodtech startups. In such a scenario, Zomato’s path to reducing cash
burn, ramping up revenues is a beacon of small hope that after years of struggle, some
startups might finally begin to get it right soon – using energy and persistence to conquer all
things.

Achievements:

 The CEO has honored with NDTV Indian of the Year.


 Zomato generated its 95 % of revenues from the commercial advertisement in the financial year 2013.
 Zomato is in 77th position in Top 100 starts up in India.

Facts and Figures


1. The company has shown a very strong revenue growth over the years 2.5 CR(FY11-12),
11.38 CR(FY12-13), 30.6CR(FY13-14).
2. The company is still in the investment phase and not been able to make any profits as yet.
Operating profits recorded are -7.22 CR(FY11-12), -10.03 CR(FY12-13), -41.28 CR(FY13-
14).The company is currently running on the money it has raised from investors.
3. Zomatos five rounds of fundings have been as follows :- $ 1 million (August 2010), $3
million (Sep 2011), $2.3 million (Sep 2012), $ 10 million (Feb 2013), $37 million (Nov 2013)
4. Info Edge has invested in Zomato in all the five stages, with Sequoia Capital joining in the
last round.Info Edge now holds a stake of 50.1% in the company.
5. After their latest acquisition in eastern Europe, Zomato now has a presence in 15
countries:the UK, the Czech Republic, Slovakia, UAE, South Africa, New Zealand, the
Philippines, Portugal, Brazil, Chile, Turkey, Indonesia, Sri Lanka, and Qatar, and over 100
cities across India.
6. It claims to provide information on 250,000 restaurants, and currently sees over 23 million
monthly visits globally, across its web and mobile platforms.
7. The company earns about 95% of its revenues from advertising by listed restaurants. Ad
rates vary between Rs 5,000 and Rs 3 lakh a month, depending upon location, cuisine and
other factors. Other revenue streams include revenues from ticketing and restaurant
booking.

Why we believe the company is poised for strong growth

1. A very clear focus -Zomato has targeted a niche market and has been able to successfully
capture this market.Zomato has focused on building a simple to use yet effective product
making its users come back again and again.With every acquisition Zomato is building a
comprehensive product portfolio in its niche market. Even their latest acquisitions-
Lunchtime and Obedovat – have strong business models that cater to the local market
needs of discovery of lunch menus.
2. Monetization of the mobile app- We know that we are very much in the mobile era today.
Zomato receives a large part of traffic from its mobile app.Zomato’s mobile app has not
been monetized as yet leaving a huge potential revenue stream unexplored. Zomato also
plans to start charging its customers for table bookings from this year.
3. New product line – In an attempt to give their customers a cash free experience, Zomato is
coming up with a product which will allow users to pay restaurant bills through mobile
application. They plan to launch the product within 3 months starting with India and UAE.
Zomato recently added a social layer to restaurent discovery allowing its users to build
networks of foodies they trust, provide and seek recommendations and chronicle their food-
related experiences.
4. Global expansion plans -Zomato is also looking to enter the Canadian market, after which it
plans to focus on the holy grail of businesses – the North America market. They further plan
to expand to Vietnam, Jordan, Kuwait, Saudi Arabia and Ireland.
5. A very strong team -Zomato has a very interesting way of hiring employees to capture
newer geographies. It invites ex-entrepreneurs to build business from scratch. These
candidates are then allowed to spend an all expense paid week at Zomato’s Delhi office
and work with the company’s team on real, live projects . If things work out well, they are
hired. This has allowed Zomato to build a very strong team with an entrepreneurial mindset.

o
Deepinder Goyal, Founder & CEO, Zomato, is the Founder and CEO
of Zomato. Prior to starting Zomato, Deepinder worked as a management
consultant with Bain and Company in New Delhi. It was at Bain that
Deepinder conceived the idea of an online restaurant information service
after seeing the demand for menu cards among his colleagues. He left Bain
in 2008 to start Zomato (then foodiebay) out of his apartment and has since
overseen strategy and product development. Deepinder graduated with a
Mathematics and Computing degree from IIT Delhi in 2005 and hails from
Muktsar in Punjab.

Deepinder Goyal's Zomato

Zomato, if you have not used it yet, is a restaurant discovery website and mobile app. It lists information
on restaurants — menus, photos, reviews curated for credibility and contact info — for 180,500
restaurants in 36 cities.

It is currently in 11 countries (including India) and plans to be in 22 new countries in the next two years. It
makes its money from ads restaurants place on their pages. Restaurants advertise with Zomato because
of better targeting. They can pay only to be displayed when someone is searching for a location —
'Colaba', for instance — and further narrow it to be displayed only for 'take outs in Colaba'.

Deepinder Goyal and Pankaj Chaddah started Zomato (Foodiebay, in an earlier avatar) while still working
as consultants at Bain & Co in Delhi. A recent deal valued Zomato, the company Goyal started in his
bedroom four years ago, at Rs 1,006 crore ($161 million). The founders' equity — the stake held by him,
his co-founder and some employees — is now worth Rs 328 crore.

Zomato, founded in 2008, is India’s largest restaurant guide


listing over 42,000 restaurants across 12 cities in the country –
Delhi NCR, Mumbai, Bangalore, Chennai, Kolkata, Pune,
Hyderabad, Ahmedabad, Jaipur, Chandigarh, Lucknow and
Indore. Zomato was started by IIT Delhi alumni in July 2008
for Delhi NCR and has expanded its services over a span of 4
years to 12 cities in India. Info Edge has invested over $6.5M in Zomato
since 2010. Zomato has recently forayed into print as well with the Citibank
Zomato Restaurant Guide 2012. Zomato is headquartered in New Delhi and
currently employs 150 people. Zomato has expanded into the international
markets with the launch of their Dubai section and will expand to more
cities in the Middle East and South East Asia by the end of 2012.
Replying to Anil Mascarenhas of IIFL, Deepinder Goyal says, “Over 4
million Zomato users come to the website every month to search places for
dining out, home delivery, catching up or nightlife.”

Did the idea to start Zomato come from the demand for menu
cards among your colleagues?
Yes, after graduating, while I was working at Bain and Company, I noticed
people queuing up in the pantry everyday trying to look for menus to order
food and that’s when the idea struck me – what if we could access these
menus online. The users can use this website that will provide in-depth
information about restaurants and events (e.g. menu cards, contact details,
pictures, directions, rating and reviews) to its users helping them make a
well informed decision before stepping outside their house. One can also get
an opinion about the restaurants through the reviews written by people who
have already visited the place.

Explain to us your business model. To what extent is it scalable?

Besides the website, how else do you reach out?


We have always maintained that Zomato is platform agnostic – apart from
the website, we have apps for all major smartphones (Android, iPhone,
BlackBerry, Nokia OVi, Windows, etc) and are now also available in print
with the Citibank Zomato Restaurant Guide 2012. We want to reach out to
users across platforms and make the process of what to eat and where to
find it as easy as possible for them.

How did you go about convincing initial investors? What were


their apprehensions?
When it comes to consumer facing portals the biggest apprehension is
around the famous chicken and egg problem - customers find value only if
we have the most exhaustive in-depth information on restaurants while
restaurant owners find value only if we have enough customers. We solved
this problem though by providing a rock solid content platform which
provides all possible information for ~99% of restaurants across 12 cities in
India. This combined with the fact that we were able to find level headed
people to work with us gave our investors the confidence to invest in us.
YoChef puts the spotlight on emerging businesses and reputed personalities to help young
entrepreneurs learn from their experiences. Watch out for posts published under YoChef to
discover entrepreneurial journeys and life lessons.
1.
1. • Indian company that started as foodie bay back in 2008 from Gurgaon before it was
rechristened to Zomato in November , 2010. • features restaurant information such as
scanned menus and photos sourced by local street teams, as well as user reviews and
ratings. The company also provides cashless payment, online ordering, white-label apps,
table reservation, and point-of-sale systems. • In 2012 , it spread wings globally and started
acquiring restaurant listing companies in emerging markets.
2. 2. Deepinder Goyal (co-founder and ceo) • worked as a management consultant with Bain
and Company in New Delhi prior to Zomato. • It was at Bain that Deepinder conceived the
idea of an online restaurant information service after seeing the demand for menu cards
among his colleagues. • left Bain in 2008 to start Zomato (then foodiebay) out of his
apartment and has since overseen strategy and product development. • Deepinder
graduated with a Mathematics and Computing degree from IIT Delhi in 2005 and hails from
Muktsar in Punjab.
3. 3. Business expansion and strategy of Zomato •The six year old company currently operates
in 23+ countries including India, Dubai, UK, Brazil, Canada, Australia, Turkey, Poland and
New Zealand. •However, with on paper companies, Zomato's presence has crossed to over
40 countries in the world. •In 2011, Zomato started its operations in various cities like
Hyderabad, Pune, Chennai, etc. and also launched applications for cellular devices.
4. 4. Cont… • In the same year only, Zomato came up with a out of the box idea and created a
website named “zomato.xxx” , a site dedicated to food porn • Later on Zomato also
collaborated with Citibank to launch a print version of the content on the website known as
the “Citibank Zomato Restaurant Guide”. • On 15th October, 2015 Zomato changed business
strategies from a Full-Stack market to an enterprise market. This led to Zomato firing 10% of
its workforce which equals about 300 people.
5. 5. Acquisitions by Zomato • NextTable • Urbanspoon was its largest acquisition for $52
million in January and marked its entry into the US, Australia and Canada markets. • Last
year, Zomato had acquired dominant local restaurant search players in New Zealand,
1. • Indian company that started as foodie bay back in 2008 from Gurgaon before it was rechristened
to Zomato in November , 2010. • features restaurant information such as scanned menus and
photos sourced by local street teams, as well as user reviews and ratings. The company also
provides cashless payment, online ordering, white-label apps, table reservation, and point-of-sale
systems. • In 2012 , it spread wings globally and started acquiring restaurant listing companies in
emerging markets

6.

1. Poland, the Czech Republic, Slovakia, Turkey and Italy.

2. 6. Major Competitors of Zomato There are lots of competitors available but majorly

there are 3 Competitors

Bookatable UK
Marketing - Subsidiary

LimeTray
Marketing - Private

Swiggy
Food & Beverage - Private
Just Eat
Food & Beverage - Public

What is Zomato?

Zomato is an online portal which lists the information on restaurants, cafes and nightclubs also including
information on home-delivery options and other dine-out choices. Zomato was originally started by Deepinder
Goyal, IIT Delhi to help out his colleagues in search for menus of restaurants. It started as a small database of
restaurants’ menus which Deepinder circulated among his colleagues to help them save time while ordering food.
The activity took off very-well and Deepinder took it to an official level, naming the website Foodiebay.com.
Officially launched in July, 2008, the website started by listing over 1200 restaurants in Delhi-NCR region and by
the end of 2008, it had already crossed the mark of 2000+ restaurant listings. In the next 6 months, Foodiebay
expanded to Kolkata and Mumbai. Deepinder knew that local knowledge of the city is more advantageous while
assigning the job, hence, he carefully chose his executives.

Capital Investment

Zomato received an initial investment of Rs.4.7 crore from Info-Edge India in August, 2010. Due to high growth
rate of the company, they witnessed an increase in capital fund investment by Info-Edge. Info-Edge subsequently
invested Rs. 13.5 crore in September, 2011 followed by a $2.5million and $10million investment in year 2012 and
2013 respectively. By the end of this period, Info Edge almost had 57% share in the company. With its plan of
expansion to different countries and other cities of India, Zomato was blessed by a whopping $37million investment
from Sequoia Capital and Info Edge in November, 2013.

Business Model
Zomato follows a simple business model. While starting
afresh in the new city, one person is assigned in each city to collect data about the restaurants and clubs around the
city. There is a centralized team based out of NCR which processes and cross-checks the data to confirm the
validity. The data is then processed to be put up on the website. There is a separate team for advertising, which sells
the website to the restaurant owners and attracts them to advertise with Zomato. 95% of the revenues are earned
from advertisements from the local restaurants, while the rest can be attributed to event ticketing and restaurant
booking.

Financial Analysis

Even though the company grew at a tremendous rate during its initial years, it witnessed an exponential growth after
rebranding itself with the new name. It is now a source of 600-odd jobs. The website observed a response from 8
million unique visitors by the end of 2012. The metros were the highest revenue earners and the company saw the
EBITDA break even in December, 2012.

The company generates its revenue from hyper-local advertising. It saw a remarkable amount of revenue amounting
to USD 2 million at the fiscal year ending March 31,2013. They now witness monthly revenues close to USD0.5
million.

Adapting with Demands

Zomato revamped its website to adapt itself to the changing requirements of the users. The revamped website had a
more focused approach on human opinions. The features of the new website are a better search feature with
additional filters as per user requirements, a more organized form of presenting the data, easy upload of photos.
They also re-modified the presentation of the reviews and added a personalization layer to the whole website.
Zomato is now viewed more as a social-network of foodies.

Marketing Strategies of Zomato

Reasons for success


Zomato is very high product focused. They ensure their customer gets the best products and they are happy. This
increased the brand loyalty among the users and they are happy to return to the website. Strategically, Zomato has
first mover advantage in the business they are in. Even though the business model is not inimitable, with the kind of
evolution Zomato is undergoing they are well set for future.

Effective use of analytical tools like Tweetdeck to gauge the interaction Zomato is able to extract from Twitter, to
track what’s happening in the network and respond quickly to loyal customers. They have been using Sproutsocial
tool as well to ease up responding to customers and monitor performance on social media.

Competitor Analysis

Just like Zomato, Google Maps started showcasing restaurants, different businesses etc. Even though it can be
considered as a competition because of similar business model, Zomato has a first mover advantage and has already
occupied large cities and fan base. In the Google maps model, only one thing which can be drawback for Zomato is
the accessibility. Many users use Google maps for navigation and Google has integrated maps with this data base
which reduces the intention to use Zomato in users. Zomato considers websites such as Justeat.in as substitutes
which have equal potential to eat up the market share of Zomato. Burrp is another website which has a similar
business model as Zomato. But Zomato also has a differentiator over other websites. While all websites just lists the
restaurants’ names and their ratings, Zomato takes a step further and gives the user, menu of the restaurant which is
updated every 90 days.

There are a lot of competitors in the market which give a tough competition. Some of the big names include Burrp!,
Yelp and Google. In addition to that, they also face a lot of challenges due to varying market demands in different
countries and different cities. They also see varying user behavior in different countries which poses a challenge to
design the market strategy for each market.
What is Zomato’s revenue model? Zomato Business Model
One thought that comes to everyone’s mind is that Zomato is earning from this very business and

generating income source from this restaurant research business. How does Zomato earn money?

Think about the Zomato Business Revenue Model. Here are few sources explained briefly about the

same:
Online Advertisement
Zomato basically advertises the restaurant brands and showcase their specialties in a very sophisticated

way. Most of the revenue, we can say around 75% comes from this advertisement only. it is somewhat

similar to the Google app as whenever we enter our locality, we come across the various restaurants that

are located nearby along with their all the details. These are basically given the restaurants only to the

Zomato so as to make it appear in their search. This form of advertisement is obviously not free for any of

the restaurant merchandise.


Online Order for Food
Whenever some orders online for the food through the Zomato app, the implicit fee is charged to the

restaurant but not to the users for using their platform to make the orders. Well, it is the duty of the

Zomato to make the delivery at their doorsteps and this is what they will be charging for. This nominal fee

is also added to the revenue of the company.


Pre-booking of The Table
If some customer wishes to book a table in advance in any of the restaurants for the dine-in, then this

could be done through the Zomato app as this facility is also available in the some of the countries but not

all. The Zomato charges nominal fees to the restaurant for using the Zomato platform to book a table in

their respective restaurant. Zomato Whitelabel is the exact platform that manages all these tasks such as

booking of the table by giving a prior notification to the specific restaurant only that one has booked for.
Other Software Tools
The other tools used by people such as billing, search history, restaurant information, reviews, and

feedback are also getting through the Zomato app. Each and every tool used by the people to search for

a particular restaurant is chargeable but not free.


Business Page for The Restaurant
The restaurant can claim a particular page on Zomato by giving a preferable link in their cards or other

receipts. Well, the management of reviews and replies on this restaurant page also generates a good

amount of revenue for the company, Zomato.


Organizing Events
Restaurants organize various events on Zomato so as to allure the maximum mass to their brand and

engage them in various interesting activities. This event organization and offers and discount coupons are

chargeable by the company. on some eve, parties are organized at the restaurants with the venture of

Zomato and ample of tickets and passes are being sold. This is the undoubtedly the great form of

revenue generation for any company and eating point too.


The Restaurant Guide for People
Zomato started a new innovative idea of launching the restaurant guidebook for the people so that they

can know every nook of the restaurant in their localities and also know the minutest details of each one of

them. The book contains all the specialties of that particular restaurant and also acknowledges you with

the approximate cost for the dine-in for two people. This actually gives you an idea for your expenses

which may tell you if a certain eating junction fits your budget or not. This s quite a practical knowledge

but very important also for one to know before their visit any place.
Wrapping Up on Zomato Business Model

Well, this online food merchandise business is no doubt worth investing but one must have a strong base

and software to deal with all the masses. As dealing with all of them with such strong rivalries in the

market is not as easy as it seems to be. One must invest time in giving something new as newer is also

better and impressive to the people. Also, you need a good business model as Zomato Business Model.

So, any such is entertained only if a better version arrives.

Zomato is a fastest growing restaurant discovery website, established in 2008 by Deepinder Goyal and Pankaj
Chaddah. Initially, it was named as Foodiebay but in 2010, it was renamed as Zomato. It provides not only
information related to nearby restaurants but also provides facilities such as online ordering, table reservations and
management. Zomato currently serves in 10,000 cities across 36 countries having 1.2 million popular restaurants
with 80 million foodies every month. It is available in 10 different languages and has 10 million reviews with 18
million bookmarks. It gives a platform to the restaurants owners to serves a large number of users a good quality of
food.
Head Quarters:

 Gurgaon,Haryana, India.

Key People:

 Founder and Chief Executive Officer – Deepinder Goyal


 Chief Operating Officer- Surobhi Das
 Chief Technology Officer - Gunjan Patidar

Logo:

 The logo of Zomato represents simply the name of the company and indicates the love for the good food. As its
mission is to ensure that “Nobody has a bad meal”.

Net revenue:

 Undisclosed by the company

Number of employees:

 5000 employees

Official Websites:

 www.zomato.com

Achievements:

 The CEO has honored with NDTV Indian of the Year.


 Zomato generated its 95 % of revenues from the commercial advertisement in the financial year 2013.
 Zomato is in 77th position in Top 100 starts up in India.

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