To feed a city

ritesh dwivedy used the internet and insight born of experience to build a successful business.

When Ritesh Kumar Dwivedy moved to Bangalore in 2005 to work with city-based startup Ketera Technologies, calling in for food became a problem if he was working late at night. The Jamshedpur boy, a mechanical engineer from the Indian Institute of Technology Kharagpur, had no idea where to order or what was available. Even if he found a restaurant, it didn’t help because often the person who picked up the phone couldn’t understand Hindi or English. A few times, Dwivedy even had the wrong food delivered to him.

 

That was the germ of a business plan, as Dwivedy wondered — why people couldn’t book tables at a restaurant or order food online the same way they could book cinema tickets and flight tickets? Together with batchmate Priyanka, and the blessings of other IIT seniors, Dwivedy started Hungryzone.com, a portal for restaurant takeaways in Bangalore in July 2006.

In the beginning, 29-year-old Dwivedy says they could offer services for very few restaurants only as they found it difficult to sell the concept to eateries in the city. They even tried out orders on phone and SMS, before hitting upon the idea of setting up computers at restaurants. “But most restaurants were too small to spare space even for a computer,” rues Dwivedy. Now they give all their associated restaurants a machine that is something like a card swiping device, only GPRS-enabled.

Hungry Zone’s business plan is simple. Surfers go through the 650 restaurants listed on the site — fine diners and hole-in-the-wall joints — browsing by locality or cusine. The menu cards of these restaurants are also on the site, so they only have to click to order. Customers pay on delivery, as they would if they ordered on the phone. Customers pay nothing for the convenience but restaurants pay 10 per cent of the bill amount as commission to Hungry Zone.

With 10,000 registered users placing 10,000 home-delivery orders and 16,000 table covers, generating Rs 5.2 crore in revenues for its associate restaurants, Hungry Zone is the premier player in its space. With ordering in food becoming increasingly common in urban India, the numbers are still small — only about 100,000 in Bangalore, a city with a population of over seven million. But in India’s IT capital, the number of “hungry surfers” is on the rise.

Hungry Zone now wants to expand by offering marketing services to new restaurants in the form of emails to targetted clientele, based on their preferences gauged from their ordering patterns.

But Dwivedy realised that he would need funds to grow the business. So in mid-2008, Indian Angel Network came in with an investment of $300,000. That went into building infrastructure and manpower. The company now employs 15 people; it has a call centre manned by six people to process the online orders or talk to those calling Hungry Zone’s “hunger hotline” phone numbers. Interestingly, all six employees here are visually impaired.

This week, IAN sold its stake in Hungry Zone to Just-Eat, UK’s largest online takeaway ordering service with operations in most of Europe and Canada. Just-Eat now has a 60 per cent stake in Hungry Zone and plans to invest a further $5-10 million over the next three years into this joint venture, and may even acquire 100 per cent stake sometime later. “The acquisition marks the first step of Just-Eat’s expansion into Asia,” says Klaus Randel Nyengaard, group CEO, Just-Eat.

Hungry Zone has now expanded into Hyderabad, Kolkata, Chandigarh, Delhi and Mumbai, but Bangalore remains its core market.