Food-tech, a segment which saw massive investments coming in last year, has been nothing but a deadbeat this year. Multiple startups shutting down — all with decent funding raised last year even for unviable business models.
Investments may have dried up, but peOple are still backing companies, who have presented a viable business model and an innovative solution to this complex trigonometric domain. One such startup is Yumlane, receiving a $1 Million backing led by Flipkart’s Sachin and Binny Bansal, and People Group’s Anupam Mittal. UK-based hedge fund Redcliffe Capital and Sachin Bhatia, co-founder of TrulyMadly also participated in the round.
Yumlane, founded this year, will deploy fresh funds for expanding its footprint and increase marketing and brand building activities. As compared to most food delivery startups, Yumlane has a slightly different model.
The Yumlane concept
Despite Zomato making a huge impact on the way you search restaurants and discover places to eat around you, there hasn’t been much innovation in this domain, despite the kind of cash backing which the likes of Foodpanda and others possess. Having said that, this domain is still, literally hungry for innovation.
Yumlane aims to leverage the vast network of offline retailers in the country for delivering food. According to the company, India has the largest number of retailers in the world with 14 14 million retailers. Moreover, 9 million of these retailers offer packaged consumer goods.
Yumlane basically offers prepared food to customers through this network of offline retail outlets. It partners with offline retailers from where it delivers packaged food to customers.
Talking about Yumlane, Founder Hitesh Ahuja says,
We would like to make great food accessible to everyone, everywhere and leverage the deeply fragmented retail landscape our country offers.
Customers can pre-order the food online and make payment as well in advance. Later, they can collect the food from the nearest Yumlane outlet. At present, Yumlane is operational in Mumbai where it has partnered with 10 retail points.
No doubt the startups has a different model than rest of food startups. The most important thing is that it can save considerable cost of delivery of food items. Notably, many food startups have invested heavily in the maintenance of its own network of delivery teams or hiring third parties.
This has hugely affected the margins of startups leading them to falter without any external funding support. In fact, Tinyowl which started off as online food ordering startup, recently merged with Roadrunnr to leverage this kind of network and operate its own logistics and food delivery business.
However, in the case of Yumlane, customers won’t get the option of home delivery- a key feature of almost all food startups. It remains to be seen how many people will accept this model where they have to pick the prepared food themselves, even though it is from a nearby retail store.