Ex-McKinsey consultant & Faasos founder turns failed Mumbai-based restaurant into $535mn startup

Self-styled as the ‘world’s largest internet restaurant company’, 45-year-old Jaydeep Barman’s Rebel Foods has changed the game in India’s crowded food delivery startup space, reports Bloomberg.

An ex-McKinsey consultant, Barman joined hands with fellow INSEAD Business School classmate Kallol Banerjee in 2012 to start Faasos, which was a traditional operation kebab chain.

The brand opened 50 physical outlets with Sequoia's backing, but was forced to shutter in three years due to sky-high rents. It then returned armed with the cloud kitchen model.

Under this model, a restaurant accepts delivery orders via phone or app but offers no seating. It is fast gaining popularity in US and Europe as well.

The kitchens function similar to a moving assembly line, optimised for maximum productivity in low churn out times – from prep, to cook, to delivery. "The entire Rebel Foods' operation runs the equivalent of 1,600 restaurants," the article quotes Ankur Sharma, Rebel Foods’s Senior Vice-President of Product and Supply Chain, as saying.

For example, the Mumbai-based startup has branded India’s long-time favourite -- the biryani -- by attaching a mythos to it. Called the ‘Behrouz’ after the fictional Persian storyline, the dish is now a bestseller, the report stated.

Similarly, Chinese dishes from Mandarin Oak (one of the company’s brands) are created by monks in China and India versions of dishes such as lasagne, quesadillas and mac cheese are prepared by 'mystical chef' Guru Firanga, it added.

The company’s various brands whip up everything from rice to dosas to pizzas. The business operates via 235 cloud kitchens in 20 Indian cities from where around two million meals are delivered, the report said.

Such infrastructure eliminates dine-in area expenses, mitigates for the discounts and allows for quicker scale-up times for a business, the report added.

Originally backed by Sequoia Capital, the start-up received additional funding of $125 million from Coatue Management, Goldman Sachs and Gojek (an Indonesian delivery service), driving up its value to $525 million.

The company has doubled sales compared to last fiscal and plans to expand operations to South East Asia. It is targeting 100 cloud kitchens in Indonesia by 2020-21 with Gojek and around 20 kitchens in the UAE by December-end.

The million-dollar food delivery space is predicated on millennials preference for ordering out rather than cooking and UBS’ Evidence Lab expects the space to grow 10 times by 2030 to $35 billion, the report stated.