FoodieBay Seeks To Raise Funds For Second Phase Of Growth

20 Comments

IIT Delhi graduates Deepinder Goyal (26) and Pankaj Chaddah (24) just quit their consulting jobs at Bain & Co. They will now focus on growing a website they started in 2008 that now has operations in three cities and 80,000 unique visitors a month.

Goyal and Chaddah started *FoodieBay.com* in July 2008. The site serves up detailed information, menus, ratings and reviews for more than 4500 restaurants in Mumbai, Kolkata and the National Capital Region (Delhi, Gurgaon, Noida). In January next year, the site will also add Bangalore to its coverage area.

The site had a precursor. Foodlet.com, which Goyal started while still at IIT-D, allowed users to place their orders on the site for a number of participating restaurants. Soon he realized the idea wouldn’t work, Goyal says. “When we had to order food for ourselves, we would just look up the number on the site and place the order on the phone. Even we weren’t using our product,” Goyal says.

His takeaway from the experience was that people don’t want a middleman between them and the restaurant. “People sometimes want to give specific instructions about their food. But before ordering, we figured they like to have all the information about the food,” Goyal says.

Foodiebay was launched in early 2008 with just that focus–as much information as possible about the food that you are about to order. So the site has complete menus, contact information, ratings and reviews by the editorial team and other standard food guide information such as card acceptance, home delivery and average price per person etc.

The site took off immediately. “It caught on very quickly, thanks also to a lot of media coverage we received early on,” Goyal says.

While food guides typically have the contact information and recommendations, they don’t have the menus, they don’t come for free and one is impossible to find when you are about to order, especially at work. A large part of Foodiebay visitors are from offices, Goyal says, adding that the site’s unique hits are somewhat depressed because of multiple people visiting from the same office IP.

He is now opening up reviews and ratings to users. “We are in the process of introducing many social features to the site,” Goyal said.

Currently, the site carries advertising from several restaurants, but he says that puts pressure on editorial independence. “Every now and then, there is a suggestion that you gives us a good review and better ratings, and we give you advertising. We politely refuse,” Goyal says.

He has a “very different idea” to monetize the site, he says, without compromising the editorial voice. But that requires deployment of some technology and that requires investment. The two partners have just about completed an investor presentation seeking about $1 million in funding. “We will soon start knocking on the doors of investors.”

The site was almost a community effort, Goyal says. Many friends from IIT helped out, many continue to work for them part time, without pay. “I have no clue why they work for us,” Goyal says, laughing, and evidently proud of what he is building. His wife and sister also helps out. When the site started in Delhi, they would go to every nook and cranny in Delhi to collect information on food outlets big and small. “It would be a big picnic with friends and family. We would collect the info and the menus and also eat at these places.” In other cities, a combination of volunteers and paid employees now do the scouring.

But how unique is their content, and how difficult is it for someone to duplicate the effort and become effective competition overnight, I ask. Or if a big media company that already has a food guide, decides to build a food portal, couldn’t they do it very easily, given that they already have most of the content?

“It’s not easy, trust me,” Goyal says. “Yes, if a big media company wanted to use their existing content on the net, they can. But they don’t have the menus. It would take anyone at least a year and a half to build something like this even if they have a lot of resources. Far easier to buy out an existing player, isn’t it?” he asks, helpfully offering me a peek into his alternative business plan.

May be somebody will take the hint.

20 Comments

Aashima

New players are already capturing the very fast.
One such example is KhaaoPiyo.com. USP of this website is that it gives you exclusive discounts to customers (more than corporate discounts). So log on to KhaaoPiyo.com get menus online, order food and get exclusive discounts. Eat. Eat. Burp !

In Noida every single restaurant knows about KhaaoPiyo.com. They are soon capturing corporate comapnies for promotion.

Gurkeerat

Some of these comments make me smile..anyways will just summarise my feedback by saying that though no denying the fact that user consumption is getting more and more verticalised one must not forget the overall relevance of the niche product in the overall value chain and the manner in which it is connected with other value adding segments. To just illustrtae a normal usage scenario wrt. Burrp/Foodiebay

User wants to search for a good chinese restaurant in GK which would be open at 11 p.m.

Logs onto Burrp from his cell phone, searches for a chinese eatery in that area, goes through the reviews, gets mixed reactions, short-lists one but to be more sure wants to have a look at the menu..

NOW…

what would he prefer…click and view the menu on Burrp itself and maintain the continuity in his search for the required information or open Foodiebay…locate the restaurant in their database and then view the Menu. I think the answer is obvious.

We need to understand that the primary need of a consumer is not to search for the Menu but to find a 'good place' to eat, the ability to see a menu is just a part of the process and therefore once a player like Burrp incorporates food menus into its database, it would immediately restrict the growth of players like Foodiebay.

Shaan Batra

Ankur, I see you're point. For instance, Yelp is large enough to dedicate resources to that area. And they can probably do an excellent job at it. However, for them to move into MenuPages territory, I believe they would have to start focusing on advertising and awareness that users can find menus on their site. MenuPages will probably be able to generate this awareness much better because it is dedicated solely to this area. Yelp, however, still has to get the message across for various other aspects of its site. Furthermore, when navigating Yelp, its not all about menus, so its harder to find the content that I might be directly interested (such as menus). These are two areas that gives MenuPages a competitive advantage. In general, focused vertical players I feel have such competitive advantages.

As they say, the riches are in the niches.

Ankur Sarawagi

Shaan, perfectly makes sense. Even if these two players were competitors, they could still co-exist.

Right now, they are not stepping on each other's toes. But don't you think it is fairly easy for a player like yelp to move into the menupages territory and vice versa?

Shaan Batra

@ Ankur Sarawagi, @Gurkeerat Sandhu and @Armchair Analyst – It may be debatable the extent to which Foodiebay's current business matches Burrp's restaurant section.

However, I think one interesting point which was mentioned earlier and should be reiterated is the concept of focus. It may not be fair to say that Burrp has lost focus, but it may certainly be fair to say that Foodiebay targets a more narrow and specific area. This idea to me is very important when thinking about opportunities in India. By targeting one vertical area, it is possible to provide much more comprehensive content in that area than competitors (over time). This leads to a site that does not have to necessarily compete with a broader social network. In this case, Foodiebay does not necessarily have to compete with Burrp. Consider the example of Menupages and Yelp.com in the US (I am located there). Both can co-exist. If I am looking for a menu, I would find myself much more inclined to go to Menupages. However, if I am looking for good reviews and feedback from other users, I would check out Yelp.

I think this is about targeting vertical niches when approaching opportunities in India. The era of the AOL and Yahoo portal (at least, in the US) lost out to smaller, focused networks. Perhaps, Foodiebay can take advantage of this notion and not fear threats from major horizontal networks.

Let me know your thoughts on this. Would appreciate your feedback!

ambastha

Nice work guys. I came across this site via ads on different websites(including facebook).

The best experience for me as a user was the availability of real MENUs with the searched results.

The problem I encountered was to find out the exact locations of the restaurants. Maps can be a better option.

Gurkeerat Sandhu

@ Ankur Sarawagi – Hope you understand how Alexa collects its data and the fact that no publisher/agency/vc considers it to be of any relevance.Would suggest you to have a look at Google Trends (for websites).

None of us want to deny credit to these guys for the work they've done but to be honest this is an open media forum and there's no harm in pointing out what is based on sheer logic and facts.

Gurkeerat Sandhu

@Fck Gurkeerat – hmm..so let's have a closer look at what you've said..

"Why you all ,kept on criticizing the good work initiated by them or in other words IITians."

none of is interested in 'criticizing' their effort but only want to share our opinion (as you too have done through your comment).would be great if you could actually counter our arguments with logic rather than get emotional about these guys doing a start-up and they being IITians…my friend, they're trying to do 'business' and not charity, so pls don't get all teary eyed.

"if you know so much about the market then why dont you start your own business.But no,beacuse start ups need commitment ,sincerity and above all,guts .and it seems you have nothing .Thats why you are sitting in front of your desktop ,busy in writing crap. "

hahahaha….truly amazed at your deep insight into my personal and professional values….would've loved to react had you backed it with some logical loophole in my argument…but yeah I get it..you're the whining types…so you're forgiven.

Some advice for you –

if you're one of the IIT guys/or a friend – It is easy to get such stories done but it is a different matter all together to manage it effectively.In my 'opinion' it is far better to be humble and be seen as having an open mind (this emotional 'I am a lonely entrepreneur who went to IIT' spiel won't take you far.

if you're a random surfer – go easy on the emotion, you're not helping these guys by writing illogical bullshit and if you can't stop…well we promise to completely ignore you from now on.

Live Cricket

I don’t write reviews to get paid. I don’t wanna be paid. Just want to help out the community so that when I wanna look up a place or listing, I get to read an honest review written by someone like me. That’s what keeps it going.

Watch
India vs Australia Live Cricket
http://mydesitv.info

Armchair Analyst

You are right – ITC did launch products under different brands, but what about Reliance or Tata? They use one global brand name. Samjhe na?

I don't write reviews to get paid. I don't wanna be paid. Just want to help out the community so that when I wanna look up a place or listing, I get to read an honest review written by someone like me. That's what keeps it going.

I didn't get offended, but just wanted to set the record straight. I am not affiliated or paid by burrp either. peace out.

Ankur Sarawagi

Sorry Armchair Analyst. I seem to have offended you. All I was trying to present was data (by a third party – not cooked up at all). Not perceptions based on being happy after being sent a goodie bag.

Also, ITC launched all its separate business under different brands. That is called diversification. Imagine selling Atta with a 'Navy Cut' brand. Hope you get the point. Happy to talk to you live if you need it.

Regarding hairdressers, I *think* they are not making any money out of them. Business expansions should be made on basis of business logic which I am *wondering* they didn't apply. So sorry if that hurts you.

Good job with the reviews. Try contacting Foodiebay – they might even pay you. Then you can buy a lot of goodie bags :)

Enjoy!

Armchair Analyst

Ah, one more thing –
@Ankur Saragawi – "Now it has hairdressers online. I am wondering if they were getting more revenue from hairdressers." – Well let's say that might be the case, what problem do you have with that?

Armchair Analyst

This comment is directed towards other armchair analysts like me* –

@Gurkeerat Sandhu – burrp already has a lot of menus and catalogues, not only of eateries but also of jewelry shops, health clubs etc. Most of the menus at burrp seem to be uploaded by the business owners themselves. So there is definitely a business owner engagement on the site.

@Ankur Saragawi – burrp depends on its community to help maintain the site. I am one the users who regularly flags dead places, incorrect phone numbers etc. "Also Burrp has lost focus" – I'd beg to differ. In the real world out there, they call it diversification. So when ITC started making shampoos along with cigarettes, it was called a diversified business strategy by many a people.

@Fck Gurkeerat – What's IIT got to do with it? You're busy writing crap as well and you're a coward also.

@Ankur Sarawagi – What're you smoking dude? Burrp's restaurant business is smaller than foodiebays? Great insight, genius but I think you're analysis is full of crap.

*I've been a burrp user for more than 3 years now and even received their goodie bag recently for writing kick ass reviews. So in that sense, I know a wee bit more about them than ya'll. peace out.

Ankur Sarawagi

@Gurkeerat

Yes, from the outside, Burrp looks like the largest player. I think that is because it has been around longer. However, I just peeped into the alexa data for burrp and foodiebay. Here are my observations – seems like a lot of traffic (78%) for burrp is coming to tv.burrp.com and not the burrp that we generally know. Scaling their traffic by that margin and assuming that they have only 22% of the traffic coming to their classifieds business, it makes their restaurant business smaller than Foodiebay (although marginally). If you also consider that Burrp has a lot of other traffic (hairdressers for example), Foodiebay will easily emerge to be more than Burrp.

In short, Foodiebay seems to have a done a good job so far. Their traffic seems to be more than the restaurant section of Burrp. However, all these websites (including Burrp) and very tiny if compared to the huge potential India holds in itself. The future may throw up some interesting twists!

Fck Gurkeerat

Why you all ,kept on criticizing the good work initiated by them or in other words IITians. @gurkeerat ..if you know so much about the market then why dont you start your own business.
But no,beacuse start ups need commitment ,sincerity and above all,guts .and it seems you have nothing .Thats why you are sitting in front of your desktop ,busy in writing crap.

Gurkeerat Sandhu

@Ankur – Agree on Burrp having lost its focus…but you can't deny the fact that it is by far the largest player in this category. 80k isn't bad for a start-up but its not enough from the point of view of deterring competition (specially the large media houses who can easily achieve 5 times of this traffic in 1/5th the time).This is a good classifieds category and should interest most newspaper websites.

@Sruthijit -There's been some talk of Time Out launching a full-fledged website…any idea ?

Ankur Sarawagi

I think Burrp and Foodiebay are completely different models. Burrp is a Web 2.0 model – where the content is not moderated at all. There are a lot of restaurants on Burrp which do not even exist anymore. Moreover, they do not really have a ton of menus as someone mentioned above. To start with, they do not have Dominos – why would someone not have a Domino's menu? Also, Burrp has lost focus – it started as a restaurant website. Now it has hairdressers online. I am wondering if they were getting more revenue from hairdressers.

Foodiebay's content, according to me is the most updated one in the current lot of such sites. And they update their menus quite often for that matter (most of the menus I checked right now are not more than 2-3 months old).

Also, I run a couple of websites myself. 80k is quite a lot of traffic. Of course, you cannot compare it to the indiatimes etc.. of the world .. but it is quite good and should not be easy for any newcomer to achieve.

Jindal

Burrp already has a ton of menus and I think are way ahead of the game when it comes to food reccos, reviews, ratings etc.

Gurkeerat Sandhu

having a menu database is a great idea…but as you rightly said not something that a Burrp or an Indiatimes will take much time to replicate..and why would it take a year..one just needs to use foodiebay's menu database and get some interns to type out what's mentioned in the scanned images (and then make it search worthy as well).Anyways…all the best dudes…guess you should do some social media stuff and get some scale (4k/day is nothing) before the big guys wake up.

Udit Joshi

Interesting. I thought they were already VC backed or something.

Comments are closed.