Companies

Zomato co-founder Gaurav Gupta quits

Our Bureau Bengaluru | Updated on September 14, 2021

Zomato Co-Founder Gaurav Gupta

Company to shut down grocery pilot from September 17

Zomato Co-Founder Gaurav Gupta has decided to leave the company, according to reports. Gupta had joined the foodtech major in 2015 and became the Chief Operation Officer in 2018 and later a Co-Founder in 2019.

Gupta’s exit from Zomato was on the heels of Zomato shutting down its in-house grocery delivery pilot and nutraceutical business. Gupta is said to be starting a ‘new chapter’ post this move.

Grocery pilot closes

Zomato started its grocery delivery pilot in July which offered a 45-minute delivery to the customers. The pilot operated on a marketplace model, which means customers were ordering groceries from their neighbourhood stores. The company intends to stop this pilot service from September 17, 2021.

“We have decided to shut down our grocery pilot and as of now, have no plans to run any other form of grocery delivery on our platform. Grofers has found a high quality product market fit in 10 minute grocery and we believe our investment in the company will generate better outcomes for our shareholders than our in-house grocery effort,” a Zomato spokesperson told BusinessLine.

In a note to grocery partners, Zomato has said that their marketplace model has had moderate success. However, the two months of operating this pilot had also made the company realise the challenges with this model. BusinessLine has reviewed a copy of the note.

“In the marketplace model, store catalogues are very dynamic and inventory levels change frequently. This has led to gaps in order fulfillment, leading to poor customer experience. We have realised that it is extremely difficult to pull off such a delivery promise with high fulfillment rates consistently, in a marketplace model (like ours),” the note added.

In the same time period, Zomato’s investee company Grofers has launched express grocery delivery service promising under 10-15 minutes deliveries. Grofers’ model is powered by a network of dark stores (mini-warehouses) which are run by express partners.

Published on September 14, 2021

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