Rahul Ganjoo, the head of Zomato’s new ventures, resigns. On November 24, UAE delivery services will be suspended.
According to a regulatory filing, Rahul Ganjoo, who was Zomato’s head of new projects and formerly oversaw meal delivery, left the firm after five years. He began working for the top food technology firm in August 2017 as the head of product development. In October 2020, he was elevated to co-CEO of food delivery. He was appointed head of new enterprises in August of this year.
After Siddharth Jhawar, the head of Zomato’s Intercity Legends service made his departure known a week earlier, this is the second prominent departure for the company in a short period.
Zomato stated in August that its meal delivery service had achieved operating break-even despite reporting zero Adjusted EBITDA for the business in the June quarter (Q1). The adjusted EBITDA loss for the first quarter has recently been revised to a loss of Rs. 113 crores.
Zomato claimed once more that it had achieved break-even in the meal delivery business with an Adjusted Ebitda of Rs 2 crore for the sector in the September quarter.
Although they all define it differently, adjusted Ebitda is a figure used by numerous tech organizations. Costs that are not considered operational for the firm, such as employee stock option charges, are often excluded from it.
The food business’s gross order value climbed by 3% in the second quarter compared to the first, the company stated last week. This was expected because the third quarter of September saw an increase in inflation, which resulted in a drop in demand for goods in the retail and online commerce sectors.
However, the fundamental problem seems to be that although the company’s food delivery service has grown, its development has stalled. From Rs 5,410 crore in Q2 of FY21 to Rs 6,631 crore in Q2 of FY22, quarterly revenues have only increased by 22%.
As a comparison, quarterly revenues rose by 158% from Q2 of FY21 to Q2 of FY22.
But there might be a bright side. Delivery expenses fell by 28% to Rs 283 crore in Q2 while marketing expenditures fell by 23% year over year to Rs 300 crore.
Given that the company’s revenue has grown by 62 per cent during this period, it would seem that the operating leverage and scale effects that investors have been hoping to see are finally starting to reveal themselves.
Zomato’s net loss for the quarter reduced to Rs 250.8 crore from Rs 434.9 crore in the corresponding quarter last year. Operating income, meanwhile, increased 62.20 per cent to Rs 1,661.3 crore.
After Siddharth Jhawar, Rahul Ganjoo is the second employee of zomato to quit.
Siddharth Jhawar, a vice president who handled Zomato’s recent foray into interstate meal delivery, has left the company. Jhawar announced that he will be overseeing Moloco, an ad tech startup financed by Tiger Global, operations in India.
Before leading the Intercity Legends service, he led Zomato’s Wings initiative, which aimed to link restaurants with investors.
“Zomato provides amazing opportunities. No mountain is too high to climb, and your prior experience has no bearing on the size of your opportunity. He stated on Sunday night in a LinkedIn post, “I received mine to create a new firm from scratch, and it was so much fun, especially with the people I was working with.
Regarding the interstate food delivery service, Jhawar has been replaced by Kamayani Sadhwani, a director at Zomato-owned quick commerce company Blinkit. Before starting at Blinkit earlier this year, Sadhwani held positions at Coca-Cola India, Bain, Accenture, and McKinsey.
The inter-city meal delivery service, which was first introduced in August in Gurugram for a select set of users, is now being expanded to additional cities, including Bengaluru, Hyderabad, and Mumbai.
Zomato plans to expand its intercity meal delivery service to 5 to 10 cities over the coming months, but only after assessing its financial sustainability. The meal delivery business believes the inter-city version will reach break-even much sooner than its intra-city service, which launched in 2015 and turned a profit in the second quarter.
Zomato will shut down the delivery services on November 24 in UAE
Zomato, a global restaurant directory, meal delivery smartphone app, and website, announced that as of November 24, it would no longer provide delivery services in the United Arab Emirates. Users will instead be routed to Talabat.
When users log in to the app, they will instead be directed to the Talabat app, Zomato confirmed to Gulf News.
Although some of its employees will lose their jobs, Zomato added that the company would protect them by giving them a “substantial severance payment.”
The business claims that it is in a good position to support its employees responsibly and is here to help them make this transition as smooth as possible for their careers.
The severance package extended includes financial and outplacement support in addition to the necessary healthcare coverage, according to Zomato.
In conjunction with the end of its delivery services, the app announced the launch of Vibe check, a new “discovery platform” that is fashioned around Instagram stories.
With new features like Vibe check and more savings available through Zomato Pay, the company has refocused on restaurant discovery and dining out, according to the statement. Users in the UAE would be able to pay using the app in affiliated restaurants with the help of Zomato Pay, a feature that is anticipated to replace the Zomato meal ordering option on the app.
Customers can still use the Talabat app to order from their preferred restaurants, including many of the ones they adore on Zomato, such as Bikanervala, Puranmal, Filli, Dyar Al Sham, Chicking, and Wok Boyz, among many more.
Zomato claims that restaurant partners can join Talabat to grow their businesses and provide customers with the delivery service that Talabat provides.
edited and proofread by nikita sharma