Zomato is an Indian website providing information related to restaurants, pubs, clubs and events at such establishments in cities of India, Sri Lanka, UAE, Brazil, Turkey, Qatar, South Africa, Philippines, and Indonesia.
Deepinder Goyal graduated in Mathematics & Computing. He started an online ordering food portal right after IIT Delhi, which did not work. Then, he joined Bain and Companya, leading management consulting firm, in India, where he worked for almost 3 years. While working at Bain & Company, he and Pankaj Chaddah (co-founder) noticed a lot of people queueing up in the cafeteria section to have a look at menu cards to order food. Most of these people were young, affluent bachelors who did not have access to home-cooked food. What they did was just put these menu cards online. That was how Foodiebay was born.
Pankaj Chaddah and Gunjan Patidar helped him in building the database.No one saw a business potential then. But then Foodiebay did start in July 2008 with a list of 1,200 restaurants in the Delhi NCR region. It wasn’t enough, though. So the trio expanded the list to 2,000 restaurants by 2008-end. Within the next six months, Kolkata and Mumbai restaurants were also listed.
Not long after that, Foodiebay got its first ad. They quit their jobs in November 2009 to focus on Foodiebay full-time. Their salaries were funding that site. There was a huge cash crunch after they left our jobs. They, meanwhile, had to incur additional costs as they launched Pune and Bangalore listings, too. To keep afloat, they even asked their friends for help. Four friends together gave Rs. 10 lakh as loans.
The revenue model is primarily advertising. It earns its revenues in two ways. Selling ad space to restaurants, one. And two, taking a share from them on leads generated through Foodiebay. This is how the second source works. Any visitor to Foodiebay can get a discount from the listed restaurants by feeding in his/her mobile number on the website. This automatically generates an SMS that has a discount coupon. This, when produced at the restaurant, is tracked to Foodiebay.
They rebranded to “Zomato” for multiple reasons. The primary reason was that they wanted to gradually diversify into non-food categories and rebranding early on comes at a lower cost. So, they gathered some guts and made the switch possible within a month. They also wanted a more powerful brand name. Zomato is already a better brand that Foodiebay could ever be.
Zomato has broken even and also attracted a private equity investor—Naukri.com owner Info Edge and well known investment partner Sequoia Capital. Zomato has forayed into International markets with the launch of its services for UAE and Sri Lanka in 2012 and for UK, Qatar, South Africa, Philippines, Brazil, Turkey and Indonesia in 2013.