Rapido, the bike-taxi platform, has officially launched its standalone food delivery app, Ownly, aiming to disrupt the current duopoly of Swiggy and Zomato. The launch follows a year-long pilot in Bengaluru and is backed by a ₹125 crore investment from Nexus Venture Partners. Rapido’s CEO, Aravind Sanka, sees an opportunity in the 70,000 FSSAI-licensed restaurants not currently listed on major platforms, targeting them with a zero-commission model to make food delivery more affordable.
### Targeting the Unseen Market
Rapido’s strategy involves onboarding smaller eateries and street food vendors often overlooked by larger platforms. Sanka compares this to Rapido’s earlier success in digitizing offline autorickshaw drivers. The average cost of eating out in India is around ₹100, significantly lower than the average order value on Swiggy and Zomato, which hovers around ₹400. By focusing on smaller, everyday meals, Rapido aims to tap into a largely unserved market.
The focus on affordability is crucial. As Swiggy and Zomato have increased platform fees and restaurant commissions, online food ordering has become more expensive, alienating a significant portion of potential users. Rapido’s zero-commission approach allows restaurants to list actual prices without inflating them to cover additional costs, potentially broadening the market.
### Challenging the Duopoly
Swiggy and Zomato have long dominated India’s food delivery landscape, but recent trends indicate a plateau in metro city growth. Both platforms have raised fees to offset losses in other areas, pushing some restaurants to inflate menu prices by 20-30%. This has led to a market that is expensive for both consumers and restaurants.
Rapido’s entry could alter this dynamic. By leveraging its existing bike-taxi fleet, Rapido can offer lower delivery costs, a critical factor in serving lower-value orders profitably. This structural advantage allows Rapido to maintain low delivery fees without incurring losses, a challenge that has plagued other entrants in the sector.
### Implications for India’s Startup Ecosystem
Rapido’s move into food delivery highlights the potential for innovation in India’s startup ecosystem, particularly in sectors dominated by a few players. The company’s approach mirrors that of Meesho, which successfully tapped into markets overlooked by giants like Flipkart and Amazon by focusing on cost efficiency and volume.
This strategy could democratize access to online food delivery, expanding it beyond the affluent urban demographic to include smaller towns and less affluent areas. If successful, Rapido’s model could prompt other startups to explore similar gaps in various sectors, fostering a more inclusive digital economy.
As Rapido expands Ownly’s reach, its success or failure will be closely watched. The company’s ability to sustain its zero-commission model while scaling operations will be critical. If Rapido can navigate these challenges, it may set a precedent for other startups looking to disrupt entrenched markets with innovative, cost-effective solutions.
