Yummybay claims wide footprint in online food ordering business, also expands overseas

Online food ordering ventures have seen a number of players entering the market. While some like JustEat and Foodpanda are national players, there are many other city-based ventures focused on single markets.

Kochi-based Amicitia Food Mart Pvt Ltd, which owns and operates food ordering portal Yummybay, has been quietly building its footprint. It claims it has partnered with as many as 4,000 restaurants in India and the Middle East and offers online orders from around 2,400 of them (it only offers review and information about the rest). This might well make it the player with the widest such network in India, given that Foodpanda's site says it has 1,200 restaurants and according to JustEat, it offers online orders from around 2,000 establishments though it has reviews and information of over 10,000 restaurants on site.

An incubatee of Kochi-based Startup Village, Yummybay was set up in October 2010 by husband-wife duo Ketty Cherian (CEO) and Vineetha (executive director). "We started as a free service for both restaurants and users and it became an instant hit. As the demand increased, we added a revenue model and started charging restaurants a nominal commission per order," Cherian said. "In addition to ordering food online, users can view restaurant details, including menu, photographs, offers, ratings and reviews," he said.

Prior to setting up Yummybay, Cherian founded Aadhocc Software Technologies Pvt Ltd, a web services company. He holds an MBA from De Montfort University in the UK while Vineetha holds a B.Tech in IT from IGNOU.

The company started with a beta launch in a few cities in Kerala and expanded to other cities in the state within two years. Yummybay now caters to customers in Bangalore, Chennai, Mumbai, Delhi and Pune as well.

It also expanded its footprint into Qatar and is looking to foray into Singapore and Malaysia by August this year. The company follows a franchisee model in Qatar and has bagged 400-odd clients there. It will replicate the same model in other foreign markets.

But why go international so early and why Qatar to begin with?

"Qatar expansion was relatively easy for us," Cherian said while discussing the firm's global plans. According to him, almost all restaurants in the country are operated by Indian expats from his own home state of Kerala. The firm found a partner, formulated a franchisee plan and it was on.

Revenue is shared based on a mutually agreed commission and while the overseas partner handles the operations, the UI and technology support besides digital marketing are handled by Yummybay. Also, it is promoting transfer of food items/cakes sent as gifts to Qatar from India.

Business model, product, differentiators:

Yummybay allows search by location, restaurant, cuisine type or a specific dish (say, Chicken Biryani). Users can either pay online (sites like Foodpanda don't have that facility) or opt for cash on delivery. But unlike similar services, one has to pay extra for home delivery.

Yummybay usually charges a restaurant 10 per cent of the bill. "We also generate revenue from banner ads and sponsored listings on our portal. Plus, we earn from food events," he said.

The 25-strong company broke even last year and currently generates around Rs 50 lakh a year. "We (the founders) decided to meet and talk to restaurants ourselves and this helped us reduce costs. Also, we introduced the revenue model in the third month after the launch. That, too, helped us break even soon," Cherian said.

The startup is now looking for VC funding and is already in talks with a couple of investors. "We are currently looking to raise Rs 1 crore. The amount will be used for local promotions and expansions," he said.

This could be critical for the startup to make a mark against peers with more financial muscle. JustEat is an international firm which also operates in India while Foodpanda is a part of the digital ventures stable of Rocket Internet.

According to Cherian, Yummybay is betting on carving a space with user-friendly UI and other tech capabilities such as better and smoother search on the site.

While its future success against peer group would depend on execution, it carries a big market risk. What if the largest restaurant listing site Zomato.com, with more than 94,000 restaurants in its kitty, adds an option to order online? Interestingly, Zomato has also gone overseas, adding cities across a few emerging markets and some developed ones. But then that's just a possibility.

What do investors think about the long-term sustainability of Yummybay?

"If Yummybay can enhance consumer experience and devise a viral customer acquisition strategy, it can make it to the top," according to Gaurav Saraf, director, Epiphany Ventures.