Zomato disables operations of its restaurant funding platform ‘Zomato Wings’
- ByStartupStory | August 12, 2022
Zomato Wings was created in November 2021 to allow equity funding for cloud restaurants/kitchens by exposing them to investors. According to the sources, Zomato was unable to develop Zomato Wings owing to a variety of factors, including the financial freeze. Wings have the potential to be revived later this year. In early 2021, the food tech behemoth worked with revenue-based financing platforms to make it simpler to fund eateries, but the experiment was terminated after three months.
The Zomato Wings platform, which it created late last year to assist businesses to connect with investors to obtain funds, has been shut down. Things have been on hold at Zomato Wings since April. According to a source familiar with the situation, the funding winter has scared off investors. There is a chance that Zomato Wings will reopen towards the end of the year. However, all actions have ceased at this moment, according to another source acquainted with the situation.
More emerging restaurants would utilize our platform to raise financing as we collaborate with more investors by linking them with entrepreneurial restaurants, and the platform flyer would create a win-win situation for restaurants and investors. However, when the stock price of Zomato dropped in the first six months of 2022, the firm opted to focus on its main business.
The global economic downturn, along with geopolitical concerns, has had an impact not just on the global stock market, but also on the funding of rising enterprises. As investors became more cautious, 2022 witnessed a dramatic decline in financing, firms resorted to layoffs, and valuation in the Indian startup ecosystem has been reduced.
The perfect solution necessitates a complicated operational setup for a wide range of restaurant partner requirements, which cannot be built in-house. According to the source, Zomat would benefit from partnering with a finance specialist because Wings would not always be fundamental to its business strategy.
It was discovered that the Deepinder Goyal-led startup had begun a trial operation to assist eateries with funding early last year by working with several revenue-based finance RBF platforms. However, the experimental project was canceled after only three months. RBF was a tiny pilot to evaluate the market for alternative instruments, but the market appeared to be modest, thus we did not extend it.
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