HomeStartupZomato aims to invest $100 million in "Grofers" to expand its business...

Zomato aims to invest $100 million in “Grofers” to expand its business beyond food delivery.


Last Updated on 22/11/2021 by Riya

An app for food delivery Zomato plans to invest $100 million in Grofers, an online grocery store. With this investment, Zomato aims to compete with well-known e-commerce stores in the online grocery market like Big Basket and JioMart. This investment will assist Zomato in expanding their business on a large scale; currently, Zomato only delivers food, but with this investment, Zomato will also be able to earn a significant amount of profit by delivering groceries. Grocery sales are up these days, as many people around the world rely on online grocery stores to meet their daily needs due to the state lockdowns.

Grofers, a seven-year-old business, has been booming since the very first lockdown in 2020, at that time Grofers supplied groceries to numerous people who were stuck in lockdown and unable to go outside to buy groceries. Grofers and Zomato have been friends for years, and their friendship will become stronger as a result of this investment. Before Grofers, last year Zomato had bought Uber’s Indian food delivery app “Uber eats” to strengthen its food delivery business.

According to sources, Zomato has been aiming to grow its business beyond food delivery from the beginning of 2020. An anonymous source claimed that a person from Zomato told, “It foresees a future where the company has expanded significantly beyond the food delivery sector.”However, both Zomato and Grofers are still in talks regarding the deal and the decision hasn’t been made yet hence we have to wait until both the Zomato or Grofers made the decision public. Previously, the Tata Group had also invested a huge amount in BigBasket to enter the e-commerce market.

According to reports, Tata bought a 64 percent stake in BigBasket. Furthermore, Zomato’s rival Swiggy too has started delivering household essential items beyond food delivery through Supr Daily and Instamart. SoftBank Vision Fund which has already owned 50% stakes in Grofers also intends to invest $450 million in Swiggy to assist the app to expand beyond the food delivery sector. Competition in the online grocery market increasing day by day and in such circumstances, it is quite interesting to see that how well Zomato will establish itself in this highly competitive sector.

Riya is a technology enthusiast and an avid researcher. She writes about consumer tech, hacking, and technology consumer issues at TheDigitalHacker.
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