A Gurgaon-based Food Tech Startup Yumist , which cooked its own meals delivered it to customers through a Cloud Kitchen Model , said on Friday it has decided to shut down after it was unsuccessful in raising fresh capital to survive in a competitive market.
We are shutting shop today. We failed to raise the kind of capital that this business required while staying true to customer proble,. In hindsight, there’s a bunch of internal and external factors that led us to this dead end. From launchhing in a second city prematurely, or committing to a high growth , high burn model just because prospective investors wanted to se that back in 2015, ot taking a tad bit too long to find the right business model, we made our mistakes. We learnt from these mistakes and recovered fast, but maybe not too fast . ” – said via a blogpost on Friday.
Yumist joins the like of TinyOwl, Spoonjoy, Dazo, amont a bunch of other food startups which shuttered operations in the past year or so. Globally, too, the segment has seen a churn with San Francisco-based Sprig and SpoonRocket shutting shop after a bevy of such services got funded in heady years of 2014-15.
The blog post on Friday said Yumist was clocking Rs 65 margins per order at an average order value of Rs 190 by March this year.
“Our delivery outlets were breaking even at just 70 orders a day, we were acquiring new customers at Rs 180 and recovering back this money within 45 days . Owning to our product quality and customer experience, we enjoyed good word of mouth( with 50% of our new customers coming through referrals), 70% of our monthly orders were from repeat customers and from March until September we tripled our revenues and gross margins. With these trends, Yumist would have become a profitable company by June 2018 . “- the blog post said.
While cloud kitchens are currently being pushed aggressively by both the biggies in the food delivery segment – Zomato and Swiggy – other smaller players like Mumbai-based Holachef which started off as online-first restaurants have found it difficult to rope in investor who will come back them against their well-funded peers. Every Economy has a context in which it operates- the economic climate, investor sentiment, the sector one operates in . Essentially, there are external factors which one coan’t really contro. 2016 onwards, food tech ( in the manner the term is loosely used) had amassed a notoriety wit investors and media and became almost a dirty word. We failed in all our attempts to fund raise since then, as investors wanted to wait it out. ”
Founded by Alok Jain , an ex-CMO at Zomato along with restaurateur Abhimanyu Maheshwari, had raised funds from Oris Venture Partners , Ronnie Screwala’s fund Unilazer Ventures among others.