Data Snapshot is a regular AFN feature analyzing agrifoodtech market investment data provided by our parent company, AgFunder.
For another year running, restaurant marketplaces dominate India’s agrifoodtech VC investments for India agrifoodtech. In India’s fiscal year (FY) 2022 — which ran April 2021 to March 2022 — the category raised $1.95 billion, the most funding of any category according to AgFunder’s India AgriFoodTech Investment Report.
Funding took place across six deals and marks a 50% increase since FY2021, when Restaurant Marketplaces raised $1.33 billion.
AgFunder defines Restaurant Marketplaces as “online tech platforms delivering food from a wide range of vendors.”
Close behind this category was eGrocery, which raised $934 million in FY22. Combined, the two categories account for 66% of all FY2022 agrifoodtech funding for India.
What’s driving the funding
Large investment figures for Restaurant Marketplaces, as well as eGrocery, reflect broader trends across global agrifoodtech investment.
The Covid-19 pandemic in 2020 and 2021 pushed homebound consumers towards buying food online and getting it delivered to their doorsteps. After an initial decline in 2020, demand for Restaurant Marketplaces rebounded.
Swiggy’s key rival, Zomato, went public in 2021.
At last check, Zomato holds a small lead over Swiggy in terms of its share of the India food delivery market. That said, the two are neck and neck and together command most of the market.
Now, however, India’s restaurant delivery services face the same challenges around unit economics and profitability as those in other parts of the world due to the ongoing economic downturn. Swiggy laid off staff in an effort to downsize its team; it may let go of more staff in the coming weeks and months. Zomato has also laid off staff.