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One of the most hyped foodtech Startup which has brought in the tradition of customer acquisition through discounts, FoodPanda has registered a growth of over more than 64% in the year FY 16-17 as compared to FY 15-16. The revenue for last year has risen from $5.87 Mn (INR 37.81 Cr) to $9.6 Mn (INR 62.16 Cr) and the company aims to be profitable by FY 2019 riding on its strategies.
Brief history of Foodpanda
FoodPanda stands as one of the early FoodTech Startups founded in Apr 2012, which was also one of the world’s largest online food-ordering marketplaces, across India, Brazil, Russia, South-East Asia and Eastern Europe. The company was founded by Benjamin Bauer, Christian Mischler, Ralf Wenzel, Rohit Chadda
During the stages of inception till the company went operational, Food Panda had raised almost $318 million ( INR 20,670 Cr) since its launch in March 2012 in 7 funding rounds, from the leading VC houses of Rocket Internet, Goldman Sachs and Falcon Capital.
The Startup had serious issues pertaining to order management system, fake orders, fake restaurant partnerships and other operational challenges. The company initially failed to bring in necessary checks and balances which later found out to be a part of huge scam and embezzlement of VC funds as per a report of Live Mint .
Controversies and Allegations
Foodpanda had been alleged for fake orders right from the registrations of restaurants to consumers ordering it. The company was managing the entire data over some open excel sheets which could easily be manipulated. Also the contracts awarded to third party vendors including some of the media vendors (for ads) were manipulated to siphon-off money from the Startup.
The great BOGO crisis
The Startup launched its Buy One Get One offer which claims to get one extra piece of meal free with the original order. A fake user books a meal over Foodpanda app from a self-created fake restaurant and eventually the fake restaurant is billed for 2 non existent or virtual orders in their account.
This crisis coupled with some other fake media vendors crisis led to a huge downfall which eventually put Foodpanda on sale.
What worked for Food Panda
Foodpanda was eventually sold to Delivery Hero Holding GmbH. Both the companies were Rocket Internet portfolio companies. Delivery Hero tried hard to bring in all forces of growth to bring back the trust and great customer experience. Right from signing Shahrukh Khan to Sunny Leonne, they have performed everything which could help the company to reach its acme.
In one of the ads Foodpanda said “Now experience Sunny Leone while following your FoodTech brand – Food Panda on Snapchat, Facebook, Twitter and Instagram.
FoodPanda will be using Sunny Leone over making short videos specially shot to cover social media campaigns. As per the company’s statement at that time “Sunny will be seen in the videos for the campaigns that would target the consumers through various social platforms such as Snapchat, Facebook, Twitter, Instagram, etc.”
Company’s strategy to bring forth brand ambassadors really worked and they have successfully encashed their followership in no time which proved to be a great thrust in the overall spike of their revenue for the last fiscal year.
Foodpanda also launched “third party food delivery service for restaurants” named “Dash” to optimize the efficiency of on-ground fleet, better services to customers and to a revenue line in the P&L statement of the company. (Profit and Loss statement)
Their delivery line of business also outperformed not just with operational efficiency but also by adding income through picking up contracts across other similar foodtech companies and helping them to deliver their orders.