Zomato invests $5 million in food robotics company Mukunda Foods to scale up quick commerce biz

Online food delivery giant Zomato has invested $5 million in food robotics company Mukunda Foods, taking the company's post-money valuation to $30 million.

Prior to this, Mukunda has raised funds from Ncubate Capital, Singapore Angel Network, and Indian Angel Network. With the fresh investment, the brand’s cumulative fundraise stands at $8 million.

The company plans to utilise funds to expand its reach across QSRs, cloud kitchens and fine dine segment. According to MarketsandMarkets, the global food robotics market is projected to reach the $4 billion mark by 2026 at a CAGR of 13.1 percent. Another report states that the Indian industrial robotics market witnessed the installation of as many as 5,000 units in 2019 and is estimated to reach 11,760 units by 2025, expanding at a CAGR of 14.41 percent.

"Zomato and Mukunda Foods share the vision of reaching every restaurant and helping them grow. While Zomato does it by helping restaurants reach more customers and increasing their revenues, we help the F&B brands increase their profitability and grow fast with our kitchen technologies. This common interest will help the F&B industry greatly,” said Eshwar K Vikas, CEO, and Co-Founder, Mukunda Foods.

Zomato’s investment will also help the startup introduce multiple ROI based models to help the F&B businesses scale, the company said in a statement.

"Our Investment will help Mukunda Foods scale Faster, help reduce restaurant food prices, expand margins and enhance customer delight," said Zomato spokesperson.

This announcement comes a week after Deepinder Goyal-led Zomato’s board approved the acquisition of a 16.66% stake in Mukunda Foods. During the same time, the online food delivery service provider also announced the launch of its 10-minute food delivery offering -- Zomato Instant. Zomato had said that the quick delivery will rely on a dense network of "finishing counters" which will be located in near high-demand customer neighbourhoods. Future-ready in-station robotics will be employed to ensure that the food is sterile, fresh and hot at the time it is picked by the delivery partner, the company had said in a blog post.

Mukunda Food which allows users to make dosas, rice, noodles and curries with limited human intervention and within a few minutes, with its offerings such as DosaMatic, Eco Fryer, RiCo and Wokie -- can play a big role in helping Zomato implement its instant delivery plan.

As a food robotics company, Mukunda helps automate food preparation at restaurants by designing and manufacturing intelligent robotic equipment. The firm so far has developed six products that have been installed in over 2,000 locations. It counts Wow Momo, Chaayos and Swiggy among its clients.

Zomato has previously backed startups such as logistics startup Shiprocket, discovery platform for offline retailers Magicpin, and fitness firm Curefit as part of its strategy to deploy $1 billion in startups over the next two years. In February, the company committed an additional $400 million to build the quick commerce category in India.

As per a RedSeer report, quick commerce is becoming one of the fastest growing e-commerce models. The total addressable market for quick commerce in India is estimated at $45 billion, with large metros and tier 1 cities driving demand on the back of mid-high-income households.