Deepinder Goyal, the founder of Zomato, became an overnight sensation in India’s burgeoning startup industry as his stock soared 66 percent on its first public offering.
Goyal is worth $650 million, according to the Bloomberg Billionaires Index, because he owns 4.7 percent of Zomato. He also has over 368 million options that will vest over the following six years and, if exercised, will more than treble his position in the company, which has a market worth of $13.3 billion.
This is a small fraction of Mukesh Ambani’s $80 billion fortune and the fortunes of hundreds of other Indian industrialists, yet the country boasts a small number of wealthy startup entrepreneurs. Byju Raveendran of online education service Byju’s, Vijay Shekhar Sharma of digital payments pioneer Paytm, and Sachin and Binny Bansal of online retailer Flipkart are among those who have exceeded the $1 billion mark.
Zomato, one among India’s first digital unicorns, is also a possible investment opportunity for retail investors in the country. The IPO prompted a rarely witnessed excitement among customers, with some boasting on Twitter about snatching allotments and jokes about deleting rival Swiggy’s app.
During a particularly unpleasant pizza purchase process while studying math and computer science at the Indian Institute of Technology, Goyal had the idea for his internet business. When he graduated and joined Bain & Co., he noticed colleagues skimming the limited menu and enviously discussing cuisine at adjacent eateries in the office cafeteria.
Goyal and a coworker, Pankaj Chaddah, began posting menus and phone information for local cafes and restaurants on the business intranet. They named it foodiebay.com, and it was a weekend project they worked on with coworkers. After his wife was hired as a teacher at Delhi University, Goyal left his job to pursue entrepreneurship full-time.
Sanjeev Bikhchandani, an entrepreneur-turned-investor and a pioneer in the realm of the internet, helped the founders raise $1 million in the early days of the business. Global investors such as Sequoia Capital, Tiger Global Management, and Jack Ma’s Ant Group Co. joined as supporters, and the company’s name was changed to Zomato.
Zomato has expanded globally since its inception in Gurgaon, on the outskirts of Delhi, offering table bookings, home delivery, and restaurant and nightlife guides in over 100 cities across 19 countries, including Turkey, Brazil, New Zealand, and Indonesia. While investor interest in loss-making food businesses was diminishing, Goyal rationalised spending by cutting jobs and moving the company closer to profitability.
“I don’t know if we’ll succeed or fail – we’ll certainly give it our all, as we always do,” Goyal stated in the posting. “However, I hope that our presence here encourages millions of Indians to dream even greater than we have, and to construct something far more magnificent than we can imagine.”
In the early days of the service, the founders raised $1 million from an entrepreneur-turned-investor and a pioneer in the world of the internet, Sanjeev Bikhchandani. The name of the company was changed to Zomato, and global investors such as Sequoia Capital, Tiger Global Management, and Jack Ma’s Ant Group Co. also joined as backers.
Since its founding in Gurgaon on the outskirts of Delhi, Zomato has expanded globally, offering table bookings, home delivery and restaurant and nightlife guides in more than 100 cities in 19 countries, including Turkey, Brazil, New Zealand and Indonesia. While investor sentiment for loss-making food startups was waning, Goyal cut jobs and geographical locations to rationalize spending and nudged the startup towards profitability.
“I don’t know whether we will succeed or fail — we will surely, like always, give it our best,” Goyal said in the posting. “But I hope that the fact that we are here, inspires millions of Indians to dream bigger than we ever have, and build something way more incredible than what we can dream of.”