Ghost Kitchens India raises $5 million for expansion
New Delhi: Ghost Kitchens India, a Mumbai-based food-tech platform that creates and runs cloud kitchens, has raised $5 million in a Series A funding round led by Ahmedabad-based GVFL Limited. The round, a mix of equity and debt, also saw participation from NB Ventures, LetsVenture, Lead Angels, and existing investors such as Yuj Ventures, Dholakia Ventures, and actor Rana Daggubati.
The funds, founder Karan Tanna said, will be used to scale its business operations and expand cloud kitchens and quick service restaurant outlets.
In February 2023, Ghost Kitchens India acquired SpeakBurgers, a brand founded by chef Vicky Ratnani. The fundraise will allow the company to open 25 offline retail stores for this brand in Western India over the next 18-24 months. The company will also launch other celebrity brand partnerships.
Ghost Kitchens India was founded in 2019 and owns about 15 cloud kitchens in Mumbai and Ahmedabad. Its technology is also used in 1,200 cloud kitchens of 150 restaurant companies in 40 cities.
“Restaurants and hotels face a lot of issues with online aggregators and don’t know how to generate additional orders and maximise revenues. In 2022 we acquired a technology company which helps them get additional revenue without having to invest much more in their cloud kitchens. We are also able to sell ingredients to these kitchens which also standardises the experience for customers,” Tanna said.
The company has ambitious plans of an IPO by 2029 and aims to be profitable in the next 12-18 months, Tanna said. “We have created 10x value for our earlier investors and are confident in continuing this performance for our new partners. The company aims to achieve an annualised revenue of approximately $26 million within the next two years,” he said.
A ghost kitchen is an eatery that operates without a physical storefront or dine-in area. It focuses solely on preparing and delivering food through online platforms such as Swiggy and Zomato.
Kamal Bansal, MD of Gujarat Venture Finance Limited, said the company has shown high customer-retention rates, using technology to optimise growth through aggregator platforms.
Ratnani added, “I joined hands with Ghost Kitchens a year ago and their infrastructure to scale brands has helped SpeakBurgers to evolve tremendously.”
Before the pandemic, India’s food services sector was projected to be a powerhouse and was projected to be worth ₹4.95 trillion by FY21. However, covid pushed the industry down to just 40% of that target or about ₹2 trillion that year.
The future, however, seems brighter. The National Restaurant Association of India (NRAI) predicts the sector will bounce back to hit ₹6.21 trillion by FY25, at a 5% compound annual growth rate (CAGR). This growth will be fuelled in part by the rapidly expanding restaurant-chain market, which is expected to grow at 20% between 2020 and 2025.
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Published: 22 Feb 2024, 10:59 AM IST
Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.