There is visible chaos at the Faasos office in Mumbai. Someone’s always yelling across the room asking for a report, someone will jostle past you with a sheet of paper; it is never quiet. The chaos means that the big 12-seater conference room in the centre of the room is always occupied. There is another smaller one, and you’ll be lucky if you get space there either. Not because there is a big meeting. It is just that the employees don’t believe in fixed seating. The company claims that its attrition rates are extremely low and once people join, they never leave. It is a safe place to be, shares a spokesperson.
Few startups have this luxury but as things stand today, Faasos has changed its business model four times in 13 years. And thrice in the last 18 months. Jaydeep Barman, founder and CEO of the company, has tried a Quick Service Restaurant (QSR). Then, a dark kitchen, which means no storefronts. Followed by a marketplace and then, a multi-brand cloud kitchen. This final pivot, says Barman, will make his company profitable. In QSR, Faasos ran with the likes of Domino’s, McDonald’s and KFC. It was essentially trying to replicate Domino’s. In the cloud kitchen business, it slugs it out with the likes of FreshMenu and HolaChef. Different beasts. Different challenges.
When a company, which was valued at $150 million when it last raised funds, tells you that it has tried four business models, it should make you think.
Kingdom of gold
Back at the Faasos’ office, in all that chaos is a series of monitors with glowing lights. Red, blue and green lights flicker on the screens. These monitor freezer temperatures across their 150 kitchens. If the colour switches to red, it means that something has gone wrong and an exception is raised. It was part of the technology upgrade in 2015 when Faasos moved to the dark kitchen model.
Dark kitchens are a concept borrowed from e-commerce. The brand doesn’t need a storefront if it can drive traction through the web or an app. And customers can get food without leaving the comfort of their couch.
None of this was needed when it was a QSR. So, let’s start at the fervent QSR dream.
Faasos started, in 2004, at the top of the food chain, pardon the pun. After a long, not-so-noticeable existence, it raised $8 million in 2011 and started scaling. It wanted to be the hottest QSR in India serving Indian food. Faasos saw traction and began tweaking its menu. It went from preparing wraps to making biryanis and salads. But somewhere along the way, investor pressure to grow meant that it made a few mistakes. And one of them was to open too many stores too quickly.