Exclusive: Cloud kitchen platform FreshMenu refills funding pot

Bengaluru-based Foodvista India Pvt. Ltd, which operates cloud kitchen and food delivery platform FreshMenu, has raised Rs 21 crore ($2.94 million) in a fresh funding round.

The food-tech startup raised this amount earlier this month from existing investors Lightspeed Venture Partners, Zodius Technology fund and serial entrepreneur K Ganesh’s Growthstory, according to the company’s filings with the Ministry of Corporate Affairs.

Lightspeed injected $1.64 million while Zodius and Growthstory invested the rest.

As per Techcircle estimates, the company raised this round at an estimated valuation of $48 million (Rs 342.50 crore). The company's last known major funding round was in January 2016, when it raised $17 million (Rs 110 crore then) at a valuation of nearly $41 million. 

It could not be ascertained whether the fresh capital infusion is a bridge round or part of a larger funding round. Recent media reports stated that the company was looking to raise up to $75 million and that it was in talks with private equity firms TPG Capital, General Atlantic, Kedaara Capital and Singapore state investment firm Temasek for the infusion.

Email queries sent to Rashmi Daga, founder of Freshmenu, seeking comments did not elicit a response till the time of filing this report.

Freshmenu

Founded in 2014 by IIM-Ahmedabad alumnus Daga, FreshMenu prepares meals and delivers from its own kitchens. It operates on a cloud-kitchen model, where it brings on board chefs to its centralised kitchens to prepare the food and delivers only online. 

In this model, the company controls the brand, tech infrastructure and logistics in order to achieve profitability. Though it runs its operations only online, in 2017 it also opened a restaurant in Bengaluru for dine-in and takeout.

One of the top ventures in the cloud kitchen space in 2017, the company appears to have run into rough weather in recent times.

In September last year, Techcircle reported a series of top management exits that the company attributed to professional reasons.

For 2017-18, the company’s operating revenue grew 72% to Rs 122.3 crore from Rs 70.9 crore the year before. However, net loss widened to Rs 43.8 crore from Rs 42.3 crore.

Food-tech segment

The food-tech segment in India was almost written off in 2015-16 but has seen a resurgence over the past couple of years. In fact, two of the most recent unicorns, Swiggy and Zomato, are from this segment.

Last month, online food delivery startup Swiggy raised $1 billion in a fresh round of funding led by South African technology conglomerate Naspers, marking one of the single-largest infusions into an Indian startup.

Earlier this month, Techcircle reported that food-tech unicorn Zomato was courting new investors in a bid to raise up to $1 billion in fresh funding from potential investors that include existing Chinese investor Ant Financial.