OYO Hotels and Homes have been expanding its wings like anything. What started only as hotels is today expanding into homes, villas and other spaces as well. And the latest expansion seems like a cloud-based kitchen startup FreshMenu. Fresh Menu is based out of Bengaluru and this deal of acquisition is estimated at $50 Mn- $60 Mn (356-427 crore)
As per an ET report, the deal will help OYO standardize its food experience across all its hotels. They also added that the company has been working on this initiative for over a year. The deal will also help OYO increase its margins.
Just last week OYO raised $100 Mn, approx. 712 crores from Didi Chuxing, a China based company, closing its $1 Bn financing round.
With the aim to increase its revenue and profit, after expanding services in international markets and strengthening foothold in India, OYO seeks to boost its food and beverages services.
Rashmi Daga founded FreshMenu in 2014. The startup provides a meal kit delivery service from its 35 cloud kitchens across Bengaluru, Mumbai, and Delhi NCR. It claims to receive 13K orders every day with an average order value of $5 (INR 325) as of January 2019.
FreshMenu was in talks with other companies like Swiggy, Ola, Eat.fit, Zomato and Faasos for acquisition earlier but none of the deals materialized due to a mismatch is pricing expectations.
The startup, owned by Foodvista India Pvt Ltd, raised $1.64 Mn (INR 11.7 Cr) in a Series B1 funding round from US-based venture capital firm Lightspeed Ventures and its Indian unit Lightspeed India Partners, in January this year. Lightspeed India Partners is a common investor for both OYO and FreshMenu. For the financial year ending March 2018, the startup increased its revenues by 62%.
According to a TechSci Research report, the foodtech market in India is projected to grow at a CAGR of over 12% during 2016 – 2021. Thus food and food-related services are at an all time rise.