A Project Report

On

SWIGGY

Submitted by:

Shubham Bhaskar Badhe(10C)

Entrepreneurship End-Term Project

Under the guidance of

Prof. Sudhir Kumar Jain

Master’s In business administration

Indian Institute of Foreign Trade, Delhi

Batch: 2021-2023
Coverage in the Term Paper:
● Basic Details (Starting year, growth pattern & current valuation)
● Entrepreneurs’ details
● What triggered the idea of the start-up?
● How was the rapid growth achieved?
● Competition Analysis & Prospects
● Conclusion

Basic Details (Starting year, growth pattern & current valuation)

Swiggy is Indian online food ordering and delivery platform founded in July 2014, Swiggy is
based in Bangalore, and operates in 500 Indian cities, as of September 2021. Apart from food
delivery, Swiggy also provides on-demand grocery deliveries under the name Instamart and an
instant package delivery service called Swiggy Genie. Swiggy is operated by Bundl
Technologies Private Limited. It was founded by Nandan Reddy, Sriharsha Majety and Rahul
Jaimini.

Within a year of launch, Swiggy had convinced many restaurants who were earlier vary of the
online channel of delivery to join forces with the platform. What differentiated it from other
players is their investment in building a proper logistics network with a vast fleet of their own
delivery boys. It especially focused on customer experience due to which their clientele didn’t
mind when they started charging for deliveries. Seeing their business model working seamlessly,
many investors got interested in funding the venture and Swiggy received its first cheque of $2
million from Accel and SAIF Partners. In the same year, the two VCs again funded the startup
along with Norwest. By then, the startup already had over 100 restaurants on board and was
delivering over 70,000 orders on a monthly basis.

The two organizers, Sriharsha Majety and Nandan Reddy, planned a web-based business site
called Bundl to work with dispatch administration and transportation inside India. The bundle
was ended and was rebranded to enter the food conveyance market. At that point, the food
conveyance area was in unrest as a few outstanding new businesses, like Foodpanda (later
obtained by Ola Cabs), TinyOwl (later procured by Zomato), and Ola Cafe (later shut), were
battling. The organization constructed a devoted conveyance organization and developed
quickly, essentially determined by the emphasis on operations and securing secret weapons.

Swiggy has raised $700 million in a new financing round, just six months after securing $1.25
billion, as it aggressively expands its offerings, including the instant-delivery service in the South
Asian market.

Invesco led the Bengaluru-headquartered startup’s Series K round, which according to a source
familiar with the matter values the seven-year-old startup at $10.7 billion. Swiggy was valued at
$5.5 billion in July last year.

At a $10.7 billion valuation, Swiggy has surpassed the valuation of its 13-year-old chief rival
Zomato, which went public last year and whose market cap has shrunk to less than $10 billion.

Entrepreneurs’ details
SRI HARSHA MAJETY- CEO AND CO-FOUNDER, SWIGGY

Sriharsha Majeti has a bachelor’s degree in BE electrical and electronics. He has also been an
alumnus of Birla Institute of Technology and Science (BITS), Pilani with an MSc degree in
physics. Harsha has previously been an associate at Nomura International which is a financial
service provider and a global investment bank headquartered in London, UK.

The Swiggy co-founder and CEO came back to India from London and started his own
entrepreneurial venture, Bundl which aimed at providing shipping solutions to e-commerce
merchants alongside Nandan Reddy who is also presently a co-founder at Swiggy.

NANDAN REDDY- CO-FOUNDER, SWIGGY

Nandan Reddy has also completed his education from BITS, Pilani alongside Sriharsha Majeti.
He has previously been known to build a start-up based on Point of Sale tablet software for
restaurants. Reddy has been a core member of management at Source Pilani that was known as
India’s first non-urban Business Process Outsourcing (BPO). Later on in life, he co-founded
Bundl along with his BITS, Pilani mate, Harsha.

At present, Reddy and Harsha are running Swiggy successfully as co-founders.

RAHUL JAIMINI- CO-FOUNDER, SWIGGY

Rahul Jaimmini completed his education from IIT-Kharagpur and then went off to intern at
Phillips Research and Virginia Technologies. He has also previously worked for almost two
years at NetApp after which he moved on to e-commerce giant, Myntra. Rahul was working as a
senior software engineer at Myntra and was responsible for revenue impactful assignments and
fast design. Later on, in 2014, he ended up co-founding Swiggy along with the other two
founders.

Recently in May, Rahul Jaimini has quit Swiggy and joined Pesto Tech as a co-founder which is
a career accelerator start-up. He is no longer a part of the day to day operations at Swiggy but
remains a board member and shareholder in the food delivering company.

What triggered the idea of the start-up?

BITS-Pilani alumni Sriharsha Majety and Nandan Reddy were always passionate about kick-
starting their own start-up. Finally, in 2013, they came up with a technology product called
Bundl to connect courier companies across India. But, unfortunately, it wasn’t off to a great start
and the duo had to shut shop very soon. It was after their courier tech fiasco that the duo
understood they needed to venture into something more needed by the common public. That’s
when they had the idea of the food-delivery business. Since none of them were good with the
coding part, they roped in Rahul Jaimini, an IIT Kharagpur graduate.

In 2014, the start-up kicked off with six delivery executives and 25 restaurants on there in the
upscale neighborhood of Bengaluru called Koramangala. Within a year, Swiggy expanded to 11
localities in Bengaluru and also opened the business in Gurgaon and Delhi. As their business
expanded, the founders started putting more innovative thoughts into their model. They hired
more delivery executives, partnered up with 300 restaurants within their functional area, and
added more user-friendly features to the application. The same year Swiggy received its first
funding of $2million from Accel and SAIF Partners and broadened its horizon to the other five
big cities- Hyderabad, Mumbai, Pune, Kolkata, and Chennai.

As good as 2015 was in respect of the funding boom, it slowly died away the following year in
2016. But, Swiggy was on its own victory high. Singapore-based RB Investments and New
York-based Harmony Partners invested a lump sum amount of $35 million in Swiggy. While
other similar platforms struggled to keep up with the fast-growing pace of Swiggy, it kept on
adding new features and extending. A new component called Swiggy express was launched
along with the introduction of surge pricing in case of excessive rain, festivals, or national
holidays.

With services like the Bowl Company, delivery till 2 a.m, and lucrative discounts, Swiggy was a
huge hit among millennials. Students or young professionals no longer had to cry or grump about
food. In 2018, Swiggy entered the prestigious club of Unicorns (start-ups valued at over 1
million). Today, Swiggy holds a record of 5 million monthly orders.

Although, Swiggy has not really been left out from its share of controversies and crisis, but it has
made its mark in the start-up industry and how! With features like Swiggy Pop (orders of Rs.99-
200 from local restaurants without any extra charges), Swiggy scheduled (one can schedule their
order according to their time), Swiggy Super (a monthly subscription pack) and so much more
Swiggy is here to stay.

How was the rapid growth achieved?

Before the launch of Swiggy, Sriharsha Majety (Co-founder and CEO, Swiggy) and Nathan
Reddy (Founder and CEO, Swiggy), saw an opportunity in the unorganized logistics and
shipping sector. The start-up’s speciality was providing small businesses with the chance to
connect with courier services using an e-commerce platform. But with the lack of technology-
focused team and major players decided to ship products on their own, things didn’t go as
planned. The venture shut down within the year of its commencement.

Rise of Swiggy, after the Fall of Bundl

Learned from past experiences, they started to look for something that can be achieved with a
click of a button. With the success of Ola and Uber, the three partners were mesmerised and saw
a massive potential in the hyperlocal market. They planned and initiated its food delivery
operations in 2014 with 6 delivery boys providing food from 25 restaurants.

Today, Swiggy by connecting consumers to over 1,00,000 restaurant partners provides a single
window for ordering from a wide range of restaurants and delivering the tasty food to your door-
step across 200 cities in India. With the use of innovative technology, Swiggy decided to provide
a hassle-free, fast and reliable delivery experience.

A Challenge to Expand

As the existing players Zomato and Food panda had limited success, experts predicted that
Swiggy is entering the already overcrowded market. To give a tough competition to the existing
players, Swiggy as a late entrant needed to develop competitive brand communication
strategies that led them to the path of success.

The first and foremost challenge for Swiggy was to convince the restaurants to join the platforms
against the competitors. Initially, the restaurant partners did not show any interest because of the
trust, but then Swiggy worked hard towards making their logistics network faster, easier and
streamlined with a widespread and strong network of local delivery boys to make it stand apart in
the online food delivery scenario.

Swiggy worked behind the idea of organising the unorganized food delivery industry. They
observed and understood the sufferings of the customer as the restaurants took extended time to
deliver the food. Back then, the food delivering options were not planned operations in place, so
Swiggy’s entrance in the market worked as an icing on the cake.

Road Ahead Towards the Success

Swiggy started gaining traction with big investors because of their instant growth in revenue. By
2015, Swiggy raised $80 million in funding. Investors started to invest in the start-up after which
the platform started to witness great heights. By the end of 2015, the food platform partnered
with 100+ restaurants, delivering over 70,000 orders per month.

In March 2016, Swiggy faced losses 65 times. In April 2016, Swiggy decided to work on cutting
costs and strengthening the logistics network. Swiggy invested in core engineering, automation,
data sciences, machine learning, and personalization to understand the customer’s needs and to
further enhance its operations in 2017. By the end of December 2017, Swiggy reached 10+ cities,
tied up with over 20,000 restaurants and their balance sheet accounted for a whopping 4+ million
transactions per month.

In 2018, Swiggy acquired Scootsy to diversify its operations in business categories, such as
groceries, fashion items, stationery and other essential goods. By 2019, Swiggy clocked around
1.4 million orders per day, extended their delivery team with 45000 agents, partnered with
1,30,000+ restaurants and now has a presence in 325+ cities across India.

Swiggy’s Business Model

With an aim to deliver the food within 30 minutes on-demand, Swiggy’s business model is
purely based upon hyperlocal on-demand food delivery business operation. Swiggy made use of
innovative technology and concepts to bridge the gap between restaurants and food lovers.

Now, let’s see how swiggy works:

1.Customer Segment: Swiggy has gained a lot of fan following as the food platform can
be operated by anyone through its mobile application or website. The application is used
by urban foodies to order food online from their nearby restaurants. Swiggy also shows
bug menus of restaurants on its applications so that foodies can choose from a wide
variety. The platform has seen a rise in the number of users as there has been an addition
in the customer type.

2.Value Propositions: As Swiggy aims to deliver the food or essential items within 30-
40 minutes, the food delivery app has the speciality of delivering food with no minimum
order policy and efficient online payment systems in place that includes Paytm, PhonePe,
Freecharge, Mobikwik, Credit and Debit Cards, Sodexo Meal, Ticket Restaurants Meal &
Zeta Food Card, LazyPay and Cash-On-Delivery. With the aim of winning customer’s
trust and confidence, Swiggy designed their mobile application with an easy to navigate
user experience.

3.Customer Relationships: As Swiggy operates through its online platforms, it is known

to promote 24*7 customer service. It has thrived to maintain a good relationship with its
customer issues and services. We all have seen people getting refunds if the user is not
satisfied with the food or service.

4.Key Resources: The platform’s main resources are:

a. Local Food Delivery Boys

b. Connection with Restaurants and Stores
c. An Easy-to-Use Mobile Application
d. Large Database of Customers and Restaurants

5.Key Activities: The platform’s main operations are:

a.Establishing and managing partnerships with restaurants, eateries and retail shops,
b.Managing delivery partners,
c.Management of Online platforms, orders and technical operations,
d.Advertising and acquiring customers, and
e.Management of payment processes and handling customer concerns.

6.Key Partners: The food platform’s key partners are:

a.Restaurants and retail shops: The prime key partners of Swiggy are the
restaurants and shops which are listed on the application, and these are the stores
which wish to deliver their food at the doorstep of people are the key partners of
Swiggy like McDonalds, Burger King and many more.
b.Delivery Providers: Delivery suppliers are the people who deliver food. They can
be full-time, part-time or freelancers who work to earn some extra money.
 7.Cost Structures: The expenses of food platforms are:

a.Payroll expenses,
b.Costs to maintain application and website development,
c.Maintenance charges and Administrative charges,
d.Advertising and Marketing Expenses,
e.Dispute-related returns, refunds and other expenses, and
f.Kitchen base-like facility setup Revenue Model.

Revenue Model of Swiggy

When it comes to the revenue model, Swiggy tends to earn through a lot of channels. In 2018,
the food delivery platform saw the rise in expenses due to increased efforts to widen its fleet
consisting of more than 90,000 delivery executives. The total expenses were more than double to
Rs 865 crore as compared to Rs 350 crore. Here are the 6 Revenue streams through which
Swiggy generates revenue:

1.Delivery charges: Swiggy charges a nominal amount of Rs. 20 to Rs. 40 to the customers for
delivering the order. The charges also depend upon the high order demands or unusual weather
conditions.

2.Advertising: There are two types of advertisements that Swiggy adopts:

a.It allows the brand to show their banner ads on the website and app for their
promotions.
b.In mobile application, Swiggy allows restaurants to show the listing of restaurants
at ‘top places’ in return for some investment from their side.

3.Commission: Swiggy takes a commission from all the restaurants from which orders are
placed. It collects 15% -25% of commission from each order.
4.Swiggy Access: Swiggy has come up with a cloud kitchen concept according to which it
provides kitchen spaces to restaurants in a particular area where their chain does not operate.
According to a source, Swiggy is planning to expand its cloud kitchen model to include 30
restaurants onboard with 36 kitchens to four new cities which will generate around 25% of
revenues in 2 years.

5.Swiggy Super: Swiggy Super is a membership program offered by Swiggy to its customers
that gives users access to unlimited free deliveries. If customers subscribe to this program, they
don’t have to pay surge pricing during excessive demands.

6.Affiliate: The company has established partnerships with some of the biggest financial
organizations such as Citibank, HSBC, and ICICI Bank. It earns money by selling their credit
cards.

Digital Marketing Model of Swiggy

As a part of their digital marketing strategy, they wanted to target the audience of 18-35
demographic which had easy access to a smartphone. This included students who cannot cook on
their own and working professionals who face hunger pangs during office hours or late at night,
and to achieve that Swiggy invested in planning, designing and curating digital marketing
strategies that have gained Swiggy the attention it aimed for. Here are some examples of the
same:

1. Search Engine Optimization:

It helps improve your website rankings on the search engine results pages
(SERP’s). For a brand to rank organically high, it is important to have a good
SEO strategy. Swiggy saw the great potential in SEO and thus really worked hard
on its Search Engine Optimisation. They leveraged the best SEO services with a
mix of relevant content marketing.
2. Social Media Marketing:
Swiggy has gained a massive following over the years on social media platforms.
What sets Swiggy apart from its competitors is their remarkable social media
campaign. In the past, it has come up with brilliant campaigns conveying the
notions of healthy eating in a humorous way by using puns and witty one-liners.
They aim to crave users by posting enticing pictures of good food on Instagram.
They leveraged social media optimization services which targeted the young
 generation and gathered a large market.Consulting a social media management
agency is recommendable if you want to showcase your product or service on
social media agencies.
3. Email Marketing:
Swiggy has leveraged creatively the power of email marketing, using attractive
subject lines and what not. Swiggy sends email with an intent, and also has a
topic- like recently it has made sure that its customers are aware of the practices
they are following to ensure safety. They also send users a lot of coupon codes
that give discounts. The visuals in the emails are also very enticing. They also
make use of current affairs and events to send humorous emails.Consult the best
branding agency for best email marketing services.As Swiggy looks towards
expanding in newer markets, it will have to keep finding innovative ways to reach
users in these cities. Now let us have a look at Swiggy’s campaigns.

Due to its unique features and great customer service, it might soon receive a competitive
advantage over other such models and increase its already increasing customer base.
Talking about the customer base, the brand has a well-established image on the online
platforms. The food delivery app has leveraged the power of marketing in various
creative ways.
Competition Analysis & Prospects

Swiggy IPO details has not been announced yet, but swiggy is preparing for IPO, since
recently they raised funding, hence they need to plan accordingly, once they release the IPO
Listing date we will update here.

Swiggy ventured into general item conveyances under Swiggy Stores, obtaining things from
nearby stores. In August 2020, the organization dispatched its moment staple conveyance
administration called Instamart, utilizing an organization of dull stores. In mid-2021, Swiggy
shut Swiggy Stores and extended its activities under Instamart.

In September 2019, Swiggy dispatched moment pickup/dropoff administration Swiggy Go. The
assistance is utilized for different exhibits, including clothing, and record or bundle conveyances
to business customers and retail clients. In May 2020, Swiggy laid off 1100 workers during the
COVID-19 pandemic. In 2021, the organization declared that it would cover the immunization
expense for its conveyance accomplices.

Strengths

● The organization started drawing in outer speculations. The original was a $2

million speculation from Accel and SAIF Partners, alongside extra speculation
from Norwest Venture Partners.
● Swiggy got $100 million from China-based Meituan-Dianping and Naspers in
2018, and a series of speculations supported the organization’s valuation to more
than $1 billion.
● Swiggy obtained Bangalore-based AI startup Kint.io.
● Swiggy got around $43 million financings which esteemed the organization at
$3.6 billion.
● Swiggy obtained Bangalore-based Asian food fire up 48East.
● Swiggy later obtained Mumbai-based Scootsy Logistics, a striving food, and
design conveyance administration, and later shut it down.
● It procured the Mumbai-based milk conveyance startup SuprDaily in an all-cash
bargain. The organization contributed Rs. 31 crores to Mumbai-based prepared-to-
eat food brand Fingerlix.

●
Plans

● Swiggy has cooperated with Burger King to give conveyance administrations.

● It has also collaborated with Google Local Guide to work with client surveys and
Sodexo to empower clients to pay through dinner cards.
● Swiggy has cooperated with Indifi Technologies to finance a program for
accomplice café

Investments and acquisitions

In 2015, the company began attracting external investments. The first was a $2 million
investment from Accel and SAIF Partners, along with additional investment from Norwest
Venture Partners. The next year, Swiggy raised $15 million from new and existing investors,
including Bessemer Venture Partners and Harmony Partners.
In 2017, Naspers led an $80 million funding round into Swiggy. Swiggy received $100 million
from China-based Meituan-Dianping and Naspers in 2018 and a string of investments boosted
the company's valuation to over a $1 billion.
In February 2019, Swiggy acquired Bangalore-based AI startup Kint.io.
In April 2020, Swiggy received around $43 million funding which valued the company at $3.6
billion.
Swiggy acquired Bangalore-based Asian food start-up 48East in 2017. Swiggy later acquired
Mumbai-based Scootsy Logistics, a struggling food and fashion delivery service, and later shut it
down. In September 2018, it acquired the Mumbai-based milk delivery startup SuprDaily in an
all-cash deal. In 2019, the company invested Rs. 31 crore in Mumbai-based ready-to-eat food
brand Fingerlix.
The company raised $800 million in Series J round funding from Falcon Edge Capital, Goldman
Sachs, Think Capital, Amansa Capital, and Carmignac, as well as the existing investors Prosus
Ventures and Accel valuing Swiggy at around $4.9 billion.
Swiggy raised a $700 million investment led by Invesco US with a valuation of $10.9 Billion.

Partnerships
Swiggy has partnered with Burger King to provide delivery services.[30] It has also partnered
with Google Local Guide to facilitate customer reviews,[31] and with Sodexo to enable
customers for paying through meal cards.[32] Swiggy has partnered with Indifi Technologies to
facilitate a financing program for partner restaurants.[33] Swiggy launched a digital wallet,
Swiggy Money, in partnership with ICICI Bank.[34]
Swiggy and drone company ANRA Technologies have started with their trials for drone
deliveries in India, as per the recent announcement.

Competitors

Main competitors are: dineout.co.in, eazydiner.com, magicpin.in, zomato.com, restaurant-

guru.in. The Indian food delivery market is fairly new and is currently valued at USD15 billion.
The market is fast growing, and its current main players besides Swiggy are Foodpanda, Zomato,
Aero by Google, TastyKhana, SpoonJoy, BOX8, and Deliver. Even though there seems to be a
lot of players in the market, Swiggy’s main competition comes from Zomato and UberEATS.
What sets Swiggy apart from most of its competitors is their fast delivery service and the
tracking feature on their mobile app which has also enabled them to attract venture capital.
Sumer Juneja, a principal representing one of the VC companies funding Swiggy said “The
company’s differentiated product offering includes delivery, which enables Swiggy to deliver a
truly end-to-end service for consumers and restaurants in India. Swiggy’s delivery infrastructure
solves a major need in the market by enabling restaurants to concentrate on their core business
and scale up their delivery revenues.”
Conclusion

Key Takeaways from Swiggy’s Business strategy

From the hyper-funding wave of 2014-15, Swiggy is the only brand that continues to thrive and
grow. Despite the fierce competition from Zomato, Swiggy successfully made its way to the food
delivery space and became a unicorn start-up.

Let’s have a look at Swiggy’s Business Strategy:

1. The Sharp focus on Logistics

The success and fame Swiggy got is just because they deeply cared about their
logistics operations and aimed to make it accessible through a click. They put the
logistics at the centre of their operations. Focusing on logistics led to a successful
future for swiggy with low cost and happy & strong network.
2. Catch the opportunity as soon as possible
Once you know what you will do, your next move is to acknowledge the latest
trend. Founders of Swiggy were well-aware of the logistics industry. They knew
that the food industry lacks technology and speed to connect customers with
brands in one click. They took advantage of the trend and Swiggy was born.
3. Build a team with growth mind-set
Swiggy is a result of a growing team that contributed towards constant efforts
without failure. If the founders had accepted defeat after the shutdown of Bundl,
they never would have touched the heights on which Swiggy is now. It is the
combination of resilience and growth-mindset that kept the ball rolling.

Target market and goals

Swiggy aims to offer reliable, fast, and consistent service delivery. They also want to increase
market share within the cities they currently exist in, while also expanding to all cities in India.
Their target customers currently include 20–30 year olds, college students, working professionals
the e-Commerce savvy, and people living away from their hometowns.

Truly, Swiggy is a perfect example of a robust start-up. The brand started with delivering food in
one city and now spreading across India. The food-delivery giant is also diversifying its logistics
business with emergency items like groceries and stationeries. It has been a unique blend of
business strategies, marketing strategies and social media strategies which has transformed the
business in just 5 years of its inception. There are opportunities for Swiggy to become the No.1
food delivery platform as the company is already giving a tough competition to other
competitors.