So, someone was asking this question to me on GV 2d back like eatclub is spending so much on promotions. Will they be able to sustain?
Ans In foodtech if LTV > GMV-CAC then it's fine. People order 2k-3k worth food, so 5oo is a small cac.
Moving forward, what do u think about foodtech space in India, Tam is huge but so many firms already there and food n relationship are two stuff ki if it's bad u will not go back to the situation again.
India has a lot of food tech unicorn 🦄.
Do you think Dil foods kinda firm which run on cloud kitchen based strategy can work in long run? Btw I use swiggy and eatclub a lot and both are wonderful products!
The list you have built above has variety of 1) aggregators 2) Cloud kitchens
Dil Food is lying somewhere in between. Neither they have cloud kitchen nor aggregation.
My honest take is - Which order a restra partner will prefer during kitchen peaks? (weekends evening). Consistency of food, quality of food packaging everything becomes questionable as restra partner won’t have skin in the game.
At the same time - aggregators like Swiggy & Zomato can crush this model easily. In fact, I think zomato tried operating some cloud kitchens not sure what’s the contribution margin today.
Swiggy Zomato both tried and shut up cloud pilots.
@thomas_shelby
Never eat from a cloud kitchen. The hygiene maintained in Hotels where customers can see the cooking area is poor. Many times I have seen rats running around.
Imagine a place where no body can see. The hygiene would be non existent. I won't be surprised if they use two day old food and mask the flavour with butter. Or worse having to eat the same food half eaten by rats.
Dil foods is not a food tech business, it's a B2B food business. Swiggy / Zomato both tried building this house via teams like New Supply / Private brands, however in my opinion, the DNA to build a food business vs food tech business is way too different.
It requires, different set of people, debt vs venture capital and slow thinking around product instead of fast paced consumer acquisition.
Coming to the space, there is always space for more given your right point around TAM.
Plan is simple, scale karo and get acquire. Founder and investor make money
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