And it’s Friday!
Honestly at this point I am quite chill with the “shelter-in-place” lifestyle- app-based workouts, working from cooking, actually cooking a couple times a week. It gets easier folks, hang in there :)
Coming to day’s news, we’ve got some good news (Rebel Foods) and some bad (OYO):
➡️ So paper.vc reported a couple of days ago that Coatue Management was looking to invest in Rebel Foods in a new round and we finally know they’re leading a $50M round that values the cloud kitchen at $700M.
➡️ I’ve been a huge fan of the company for a while. As a 17 year old I got to intern at a startup accelerator and we had a shared space with the India Quotient team (this was back in 2013). And while I would bring my dabba to work everyday, Anand Lunia, who had a whole portfolio of food tech/QSR cos, would occasionally order food from these platforms and encouraged us to do the same.
➡️ This was way before Zomato did deliveries and Swiggy even existed, and to me food delivery was restricted to McDonalds & Dominoes. But I did think could the Indian McDonalds be a Faasos that has restaurants all over the country and focus mostly on deliveries.
➡️ It seems like the company has executed phenomenally on that vision. What started out as QSR spots all over Mumbai & Pune has transformed into a cloud kitchen behemoth with multiple brands all across the nation.
➡️ And while a ton of businesses have been impacted severely by COVID, it seems like food delivery businesses haven’t been hit as bad, and are probably doing pretty well. Plus with behavioral changes in the mainstream towards making online groceries/food popular for everyone, Rebel Foods is poised to do well.
➡️ It seems like OYO just can’t catch a break this year. After the NYT piece in early Jan and the layoffs over the last couple of months, the company has placed thousands more on furloughs globally.
➡️ Ritesh also came out a message to the entire company in this YouTube video- https://www.youtube.com/watch?v=-1V3HE_2XOk, which to me sounds a little odd.
➡️ The company’s occupancy (and revenue) has been hit significantly trending downwards of 50-60%, and I presume is likely to keep going down while India is under lockdown.
➡️ Their US presence has also been impacted significantly with many states shutting down non-essential services, but China recovering + Japan not being significantly impacted are a couple of bright spots.
➡️ The company also recently stopped paying its partner hotels their guaranteed revenues by ivoking a force majeure clause, which some partners allege weren’t even in the original agreement.
➡️ I’m not really sure how this is going to pan out for them, on one hand things could get really ugly but on the other OYO is still very well capitalized so they could possibly ride this out.
Feedback & ❤️ always appreciated
More on Monday :) BONUS (Tweet of the day): https://twitter.com/dkhare/status/1248298717720920071