In a faltering Indian food-tech ecosystem where most startups are taking to closing shop, on-demand food delivery startup Box8 has managed to top-up its coffers with a fresh ₹50 crore(approx $7.47 million) in its Series B round of funding. This round has been led by IIFL Seed Ventures Fund, a unit of IIFL Holdings Ltd, along with participation from existing backer Mayfield Fund.
With this influx of fresh capital, the company plans to strategically consolidate in key operational markets. It also plans to employ the funds to strengthen the supply chain ecosystem, build superior technology/products and step foot into new geographies including Delhi, Chennai, and Hyderabad in the next 12 months.
Prior to this round, Box8 has secured over $3.5 million from Mayfield Fund and a clutch of angel investors. These include Mu Sigma founder and CEO Dhiraj Rajaram and Kaushal Aggarwal, the co-founder and managing director of Indian Angel Network. This round not only marks the biggest single investment for the company but also welcomes another new investor, IIFL, to the party.
Commenting on their lead investment into Box8, Prashasta Seth, CEO of IIFL AMC, says,
IIFL Seed Venture Fund has successfully invested in NBFCs, consumer internet and technology companies. This is our first investment in food business and we are excited about it.
Their[Box8’s] ability to control the entire food experience is a strong value proposition and when it is replicated by the passionate team across other major cities, Box8 will emerge as a major force to reckon with in the food industry.
Nikhil Khattau, Partner at Mayfield Fund also comments on their standing relation and says,
It is their focus on classical business fundamentals combined with a new-age technology driven approach which sets them apart. They are very focused on the product and are glued to the consumer need.
At the same time, they have been able to scale rapidly by using technology and data effectively. We are very happy to have partnered with them and are confident in their approach.
Box8, previously known as Poncho, is a full-stack food delivery service provider founded by IIT-Bombay alumnus Anshul Gupta and Amit Raj in 2012. The company pivoted from serving Mexican food under the Poncho moniker to offering an assortment of sandwiches, wraps, salads, ice-creams in the form of meal boxes.
The primary goal of the company is to ensure a delightful end-to-end experience every single time. Thus, Box8 is involved in every step of the dining process, starting with the procurement of raw materials, the healthy preparation of meals to its timely delivery to customers. It is currently operational in Mumbai, Pune and Bengaluru.
The company which has a 1,200-person strong team is serving over 12,000 meals a day, with an average order size of about 2 to 2.5 meals. The average basket value of each order is expected to be somewhere north of Rs. 400. Box8 also boasts about its full -stack sustainable model which sees over 85 per cent of transactions from repeat customers.
The company has already cemented its position in the food-tech industry and this investment is only expected to make this stance even stronger. Excited about the future prospects of Box8, co-founder Anshul Gupta says,
We are glad that our investor partners share our vision of becoming India’s largest QSR chain for Indian food, catering to the taste buds of modern Indians.
With the growing working class and their changing lifestyle preferences, there is immense potential to be tapped. This new influx of capital will allow us to capitalise on the opportunity by expanding to three to four more cities using the same micro intensive approach.
Box8 has not only put a dent in the $7.5 billion food-tech industry but also emerged a winner in a time when there is a drought of funds. This huge investment will help the company further strengthen its long-standing business model and compete against the likes of Swiggy, Zomato Delivery, and the struggling runnr. Swiggy has just recently picked up $15 million in Series D from Bessemer Venture Partners at a $200 million valuation. It has brought in former Myntra co-founder Mukesh Bansal to advise the company in its next phase of growth.