Gurgaon-based Zomato Media Pvt Ltd, which owns the popular restaurant and event-listing and review site Zomato, has just closed its fifth round of investment worth $37 million led by Sequoia Capital with participation from existing investor Info Edge (India) valuing it around Rs 1,000 crore or $158 million. So far the five-year old company has raised $53 million, no mean feat for a non-ecom consumer internet business. What adds to its feathers is that in a short time, the company has reached out to more than 35 cities across 11 countries. Info Edge, a consumer internet firm itself and its majority stakeholder, has put in about Rs 143 crore through several rounds in Zomato starting with August 2010. In a chat with Techcircle.in Sanjeev Bikhchandani, founder, Info Edge, talks about how it envisions Zomato's growth.
Here are edited excerpts:
What made you invest in Zomato in the first place? When you invested in Zomato the first time had you imagined it would scale so much growth so quickly?
A combination of factors—Zomato has a great team, it had market leadership even in 2010, and it is a great product—made us put in money in the company. We knew that it has the potential of being the first global internet business out of India and that is what is happening now.
We reckon Zomato is valued around Rs 1,000 crore or over 3x the level when you last invested in February this year. What explains such a jump?
I can't comment on the valuation bit. A total of Rs 227 crore has been put in; of this, we have put in around Rs 53 crore. From this, you can figure out valuation yourself.
But the latest transaction is a huge funding round for a firm which is not a cash guzzler. Does it even require such funding?
We (Zomato) have big plans on going global. In two-three years, the company is planning to expand to 18-20 countries. Yes, the company is in initial stages but it has shown exceptional growth which explains the funding.
What kind of milestones you have in mind for Zomato in a year or so? Would we see Zomato embedding transactions, say food ordering, on its site or entering other businesses?
As of now the money will be used by the company for the slated geographical expansion; then we will see if we need more money for expansion. There are no plans of adding more revenue streams to the model in the near term.
What is the end game for Zomato? What kind of exit do you envision? Would you prefer a public listing through an IPO or a strategic sale?
Zomato is going at a great pace. Hopefully we see it going public. Ideally that would be our plan but it also depends on how the company performs in future.
Of all the investments you have made, would you say Zomato has been your best bet till now?
We have been lucky in terms of investments. We have some good companies like Mydala, Meritnation and Happily Unmarried in our portfolio. Zomato obviously has been a very good investment but for us all of them are good.
(Edited by Joby Puthuparampil Johnson)