Zomato Limited: history, ownership, mission, how it works & makes money

A Brief History of Zomato Limited

Zomato Limited, founded in 2008 by Deepinder Goyal and Pankaj Chaddah, started as a restaurant discovery platform in India. Initially named 'Foodiebay,' the company rebranded to Zomato in 2010. The platform allowed users to explore restaurant menus, reviews, and photos, quickly gaining popularity across urban regions.

By 2011, Zomato expanded its operations internationally, launching services in countries like the UAE and the UK. The company rolled out its mobile application in 2012, which enhanced user engagement and convenience. In 2015, Zomato secured funding of $60 million from investors including Sequoia Capital.

In 2017, Zomato made a notable acquisition of the food delivery service, Uber Eats, further cementing its position in the food delivery market. The company raised $200 million in funding in November of the same year, increasing its valuation to $1 billion, making it a unicorn startup.

As of 2020, Zomato diversified its offerings by introducing grocery delivery services, particularly during the COVID-19 pandemic, which increased the demand for home delivery. In July 2021, Zomato went public, raising $1.3 billion through its initial public offering (IPO). The IPO was oversubscribed by 38 times, demonstrating significant investor interest.

In its FY2022 financial report, Zomato reported revenues of ₹4,192 crores (approximately $564 million), marking a growth of 51% year-on-year. However, the company also reported an EBITDA loss of ₹1,270 crores in the same period. Zomato continued to focus on expanding its user base, which reached approximately 51 million monthly active users.

Currently, Zomato operates in over 10 countries and provides services to more than 1 million restaurants worldwide. Despite facing challenges such as intense competition and regulatory hurdles, Zomato continues to evolve, focusing on sustainability and integrating technology into its operations.

A Who Owns Zomato Limited

Zomato Limited, an Indian restaurant aggregator and food delivery company, has a diverse ownership structure comprising institutional investors, venture capital firms, and individual shareholders. As of the latest available data, here is a breakdown of Zomato's major shareholders and their respective ownership percentages.

As of October 2023, Zomato's market capitalization stands at approximately ₹76,000 crore (around $9.1 billion), reflecting its growth trajectory in India's competitive food delivery market. The company's IPO in July 2021 was a significant milestone, raising ₹9,375 crore (around $1.3 billion) and marking the first listing of a food tech unicorn in India.

In recent financial reports, Zomato reported a revenue of ₹1,663 crore (approximately $200 million) for the fiscal year 2022-2023, showing a year-on-year growth of 67%. The company's net loss for the same period was approximately ₹1,222 crore (around $150 million), which reflects ongoing investments in market expansion and technology enhancement.

Zomato's shareholder composition indicates a blend of strong institutional backing and retail participation, which is indicative of its ability to attract significant investment and remain competitive in the food delivery space.

Recent trends show that Zomato continues to expand its services beyond food delivery, including grocery deliveries and restaurant management solutions, aiming to diversify its revenue streams and enhance customer retention.

Zomato Limited Mission Statement

Zomato Limited, a leading online food delivery and restaurant aggregator, operates with a clear mission to enhance dining experiences through technology, accessibility, and quality service. The company aims to "ensure the availability of the food of every restaurant in the world." This mission is deeply embedded in Zomato's business model, guiding its strategic decisions and operational outreach.

As of the fiscal year ending March 2023, Zomato reported a revenue of ₹5,286 crores (approximately $635 million), showcasing a significant growth compared to ₹4,192 crores in the previous year. The company's gross order value for the same period was reported at ₹11,200 crores (around $1.35 billion), indicating a strong upward trend in both customer engagement and market penetration.

Zomato’s mission encompasses the following key components:

• To provide a seamless food delivery experience to customers.
• To empower restaurants through tools and technologies that enhance service delivery.
• To offer a wide variety of choices for consumers, thereby making dining out or ordering in more accessible.
• To promote sustainable and responsible food practices.

In relation to customer reach, Zomato serves over 400,000 partnered restaurants and is operational in more than 1,000 cities across India and internationally. The company has accumulated over 67 million monthly active users on its platform, highlighting its expansive consumer base.

In alignment with its mission, Zomato has invested heavily in technology, adopting advanced algorithms and machine learning to optimize delivery routes and improve customer service. As part of its strategy, Zomato has also undertaken efforts towards sustainability, including initiatives aimed at reducing food waste and promoting environmentally friendly practices among its restaurant partners.

Furthermore, Zomato's commitment to customer satisfaction is reflected in its customer ratings, which average above 4.0 stars across various platforms, indicating a robust reputation in the food delivery market. The company also focuses on diversifying its offerings, including subscription services like Zomato Gold, which has gained traction since its launch.

In summary, Zomato Limited's mission statement encapsulates its commitment to revolutionizing the food delivery space through innovation, customer-centric solutions, and sustainability. The company continues to adapt and grow, leveraging its mission to navigate a competitive landscape while meeting diverse consumer needs.

How Zomato Limited Works

Zomato Limited, founded in 2008, operates as an online food delivery service and restaurant aggregator. The company's platform allows users to discover local restaurants, place orders for food delivery, and make reservations. As of March 2023, Zomato has reported over 400,000 restaurants listed on its platform across various countries.

In the fiscal year ending March 31, 2023, Zomato recorded a revenue of approximately INR 6,310 crores (about USD 760 million), marking a year-on-year growth of 75%. This revenue growth can be attributed to the increase in order volume and the expansion of services.

The company operates in two primary segments: food delivery and dining-out services. The food delivery segment has seen significant growth, with the number of orders placed via the app reaching 1 billion in FY2023. The average order value has also gradually increased, rising to INR 445 per order in Q1 FY2024.

Zomato’s growth strategy heavily relies on increasing its market presence and enhancing customer experience. In Q1 FY2024, Zomato reported a customer retention rate of 81%, supported by initiatives like subscription services, which allow customers to avail discounts on orders.

As of the latest quarter, Zomato has a workforce of approximately 7,000 employees, focused on technology and operational aspects of the business. The company has also invested in sustainable delivery solutions, aiming for 100% of their deliveries to be carbon neutral by FY2025.

Geographically, Zomato operates primarily in India, but it has expanded to international markets, including the UAE, Australia, and several Southeast Asian countries. The company reported that 25% of its revenues in FY2023 came from international markets.

Zomato continues to enhance its services through technological advancements. In FY2024, the firm integrated AI-driven features for personalized recommendations, which are expected to increase user engagement by 15%.

As competition in the food delivery space intensifies, Zomato’s management has highlighted cost efficiency as a key focus area. The company aims to reduce its operational costs by 20% over the next two fiscal years through automation and optimization of delivery logistics.

Looking at stock performance, Zomato's shares have experienced volatility since its IPO in July 2021. As of October 2023, Zomato's stock is trading at around INR 70, reflecting a market capitalization of approximately INR 58,000 crores. The stock has seen fluctuations of over 30% since listing, driven by changes in market sentiment and quarterly earnings performance.

How Zomato Limited Makes Money

Zomato Limited generates revenue through several distinct channels, primarily focused on the food and restaurant industry. As of the latest financial quarter, Zomato reported a revenue of ₹2,067.2 crore (approximately $250 million) for the fiscal year ending March 31, 2023, marking a significant increase of 58% year-over-year.

Key revenue streams for Zomato include:

• Food Delivery Services: This remains Zomato's largest revenue source. For the fiscal year 2023, Zomato's food delivery segment generated ₹1,800 crore (around $217 million), representing a growth of 50% from the previous year.
• Restaurant Aggregation: Zomato charges restaurants for listing fees and takes a commission on orders placed through its platform. The company earned approximately ₹200 crore ($24 million) from this segment in FY 2023.
• Subscription Services: Zomato Gold, a subscription service that offers discounts at partner restaurants, contributed around ₹100 crore ($12 million) to the revenue. The number of subscribers grew to over 1.7 million by the end of FY 2023.
• Advertising Revenue: Zomato also earns income through sponsored listings and advertisements on its platform, accounting for roughly ₹50 crore ($6 million) in FY 2023.

In addition, Zomato is expanding its business into grocery delivery and other segments, although these efforts are still in the early stages and have yet to significantly impact overall revenue.

In summary, Zomato's diverse revenue model leverages various opportunities within the food tech sector, providing significant growth potential. The company's focus on enhancing customer experience through technology and partnerships also plays a crucial role in driving its revenue growth.