Zomato swallows Uber Eats India — just desserts or a bitter pill?

Uber Eats India's fickle, deal-seeking customer base and heavily loss-making operations weren't enough to deter Zomato from an acquisition. Here's why

When Uber Eats was launched in India in 2017, it was part of a global strategy for its parent company, Uber

While most expected it to succeed, Uber Eats India has barely dented the market share of incumbents Zomato and Swiggy

Instead, after close to three years of futile efforts to catch India's foodtech heavyweights, Uber has sold the struggling food delivery business to Zomato

But given Uber Eats India's woes, questions linger about why Zomato even bothered to acquire it. Especially after rival Swiggy passed on an acquisition

There was a time when startup investor wisdom decreed it difficult, if not impossible, for Indian startups to compete with and win against global majors looking to expand into their domain in India. The Uber of India would be Uber, and the Amazon of India would be Amazon. On 21 January, when food tech major Zomato announced its acquisition of Uber Eats’ Indian business, that thinking went out the window.

AUTHOR

Sumanth Raghavendra

Sumanth is a serial entrepreneur with more than eighteen years experience in running startups. He is currently the founder of Deck App Technologies, a Bangalore-based startup attempting to re-imagine productivity software for the Post-PC era. Sumanth’s columns appear regularly in leading publications. He holds MBA degrees from the Indian Institute of Management, Bangalore and Thunderbird, The American Graduate School of International Management, USA.

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