Zomato, the online food delivery and restaurant discovery giant has reportedly acquired a Bengaluru-based startup known as TongueStun Food in a cash and stock deal. The startup is basically concerned with aggregating caterers and restaurants for office canteens.
Following this acquisition, the valuation of the company will reach $18 million as stated by the people involved in the transaction. Also, Deepinder Goyal, the co-founder & CEO of Zomato has confirmed the news of transaction. He also stated that they saw immense growth opportunity in the food at workplace segment.
“We don’t see the ceiling to how big this market could become just yet. What we know is that this market is very high frequency, and customers are very sticky as they end up placing more than 20 orders a month on the Tonguestun platform,” Deepinder Goyal said.
Founded in 2012 by Manjunath Ramakrishnan, Tonguestun is an online platform for enterprises to discover, engage and manage food at the workplace. The company works as an online marketplace, and has so far raised less than $5 million. The company has over 1,000 curated food partners with 1,500 companies on its platform across six cities.
With this acquisition, Zomato aims to make fuller use of the five-year-old startup’s network to offer opportunities to its restaurant partners to cater to a large corporate market.
TongueStun counts Accenture, Mindtree, Deloitte as some of its existing customers. This deal has marked the 12th such acquisition of Zomato.
The rivals, Zomato and Swiggy are at present involved in an aggressive cash-guzzling battle to win customers, which has led them to constantly raise huge sums of capital to finance discounts and promotions.