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Acquisition of Two Online Restaurant Guides by Zomato

Date:22-08-2014

Zomato which is an Indian restaurant discovery and search portal has acquired Obedovat and Lunchtime, leading restaurant guides, in the Slovakia and Czech Republic respectively.

One of the world’s biggest restaurant discovery services, Zomato will now be functioning in 15 countries. With the acquisition of Obedovat and Lunchtime for approximately Rs20 crore ($3.25 million), Zomato will build an integrated product over the coming months and expand its footprint in international markets.

Zomato acquired MenuMania, New Zealand’s restaurant search website, for an undisclosed amount in July this year. Zomato’s chief executive officer and co-founder, Deepinder Goyal said that over the next two years, the company will infuse $2.5 million into its Slovakia and Czech Republic operations.

According to Pankaj Chaddah, Zomato’s co-founder, in the coming months the company is also planning to enter 10 more markets through inorganic and organic expansion. The company will also launch operations in countries such as Colombia, Canada, Oman, Ireland, Jordan, Poland, Vietnam and Malaysia. The expansion plans will require Zomato to raise money in the next year, which will be considerably higher than its last round in November 2013 of $37 million it raised from Sequoia Capital.

Zomato was founded by Chaddah and Goyal in 2008. So far, the company has raised $53.3 million from investor like Sequoia Capital and Info Edge Ltd, which is an India-listed company that owns the job portal Naukri.com. Zomato employs around 800 people worldwide.

Chaddah said that he expect 70-75% of their user base to come from international markets within a year.

Zomato faces competition from companies such as Network18 Group company, Burrp. The company also indirectly competes with food ordering websites such as Foodpanda, Just Eat which is based in London and JustDial, a search portal. Globally, Zomato faces intense competition from firms such as Time Out and Yelp.

Zomato makes money from advertisements placed by restaurants on its web portal. Zomato’s mobile application which presently does not show any advertisements will see mobile ads going live within a month. Zomato said that it will eventually get into online food ordering too, directly competing with Foodpanda and Just Eat.

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