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Cloud kitchen Startups on Cloud9

The F&B industry is poised for transformation due to technology shifts, changing consumer habits, and rising disposable incomes. Cloud kitchens are one such emerging segment gaining popularity & it is expected to gain more traction as Gen Zs enters the market.
Cloud kitchens are delivery-only restaurants where the preparation + packaging of food takes place while operating at a fraction of the costs incurred by traditional restaurant establishments (rentals, decor, equipment, & wait staff can be saved while operating virtual cloud kitchen brands). Simply put, a cloud kitchen is a 4-walled kitchen structure from where food is dispatched to customers who’re ordering from their offices or homes.
Consumers place their orders via food delivery aggregators such as Zomato, Swiggy, or direct-ordering platforms such as DotPe, Thrive, etc. These orders are then accepted on POS Systems such as Posify, Posist, & Limetray.
In the end, direct orders are fulfilled via third-party logistics (3PL) providers such as WeFast, Dunzo, Pidge & others.
Foodtech & cloud kitchens are highly scalable, profitable, & asset light compared to traditional F&B concepts. Consequently, their investments & ROIs have reached record highs in 2021 and are expected to grow to a $4 billion industry in India by 2024, up from $1 billion in 2021. The restaurants without physical stores, which only deliver and operate through cloud kitchens, could outpace growth of physical outlets in the next 12 months, despite the reopening of dine-in.
Rebel Foods, an Indian startup which is also backed by Goldman Sachs Group Inc. and Sequoia Capital, entered the Unicorn club to achieve a billion-dollar valuation after securing $175 million in a funding round led by the sovereign wealth fund Qatar
Investment Authority.
It said it’s growing at 100% annually and moving toward profitability with an annual run rate of over $150 million. It operates more than 45 brands from Behrouz Biryani to Ovenstory Pizza and Faasos wraps across 10 countries including India, Indonesia, the United Arab Emirates and Malaysia.
Founded by Kiran Prasad, Hygiene BigBite pivoted to a multi-brand cloud kitchen model in 2017 which has raised $15 million from Falcon Edge. It currently operates 10 brands — including Gunpowder and Biryani Trip — across 50 kitchens.
Cloud kitchens will continue to gain the edge by accelerating cost-savings and margins by leveraging trends like kitchen automation, drone delivery, the gig economy, and rising real estate costs in urban areas. The myriad models are peaking investor interest in the F&B space and when it comes to innovation in this space, we have seen only the tip of the iceberg yet!

Credit : Akhil Handa

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