In the startup world, food tech is once again gaining a hotspot. We have seen some closures in the past – TinyOwl, Yumist ( merged with Roadrunnr, to form Runnr which was acquired by Zomato in 2017) being the well known ones. We have also had new businesses experimenting with business models beyond food delivery. The market of food delivery is dominated by Zomato, Swiggy and Foodpanda (now with OLA), while Uber Eats is gradually getting ground. And with so much happening on delivery front there are businesses exploring the area of corporate catering, cafeteria management etc.
Zomato in its quest to be a dominant player continues to be on an acquisition spree. It has recently announced the acquisition of TongueStun, one of the largest players in the corporate cafeteria sector.
The Sequoia Capital-backed Zomato company acquired TongueStun at around around $18 million. The acquisition is expected to help scale up and support the six-year-old startup which has so far raised about $5 million from the likes of Uniqorn Venture and Haresh Chawla, a partner at private equity fund, True North.
Manjunath Ramkrishnan and Sundhar Varun the founders of TongueStun has over 1,000 food partners besides 1,500 companies on its platform in six cities including Bengaluru, Mumbai, Hyderabad, Gurugram, and Pune.
TongueStun Company connects corporate offices to caterers and also provides simplified food ordering with secured payment options by enabling their clients to organize a great meal experience at all the workplaces.
In a Day, TongueStun delivers more than 1 lakh meals to its tie up companies like Accenture, Mindtree, Genpact, Deloitte and others.This company functions on the similar space as PapasTiffin and Hungerbox.
With this acquisition, Zomato plans to integrate TongueStun app with Zomato and explore opportunities to scale up in the corporate segment. Zomato had earlier in 2017 accurired Runnr to boost its delivery capabilities and to build a captive fleet of delivery personnel—a model very similar to Swiggy.
Zomato has been exploring many opportunities to accelerate its business. Besides online ordering, it had announced that they actually wants to supply raw materials to all its 50,000 restaurant partner base.