HungerBox: Disrupting the B2B FoodTech Space in India
| Case Code: BSTR621 Case Length: 10 Pages Period: 2016-2020 Pub Date: 2021 Teaching Note: Available |
Price: Rs.300 Organization: HungerBox Industry: Foodservice Countries: United States, India Themes: Disruption, Innovation, Business Models, Digital Disruption |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Business Model
HungerBox offered a robust, customizable, and scalable technology solution to manage corporate cafeterias. Its vision was to enhance the cafeteria experience for the employees, serve as a one-stop solution for the facilities/admin team, and enable food vendors to eliminate cash pilferage. This was made possible through its unique business model where HungerBox served as a technology solution provider as well as Food Vendor Partner aggregator. The company worked on an asset-light model where it owned relatively few capital assets compared to the value of its operations. It did not own any catering equipment, ingredients, kitchen space, or transport vehicle. Though it was involved in the food business, HungerBox did not prepare food and therefore did not compete with its food partners. The platform served as a bridge between the users and the food partners while also enabling facilitators (such as admin teams) to make informed decisions using real-time data..
Expansion and Success
HungerBox called the “SAP for food” by its founders successfully addressed the needs of the typical working professional. In 2017, the team managed to add 30 more clients from cities outside of Bengaluru. The year 2018 was a turning point for the company. The startup raised US$2.5 million in funding from Singapore-based Lion Rock Capital Ltd and individual investor Kris Gopalakrishnan in January 2018. By February 2018, the number of orders placed through HungerBox reached a total of 7 million. For the fiscal 2018, HungerBox’s Gross Food Sales (GFS) were Rs. 1.24 billion and revenue generated was Rs. 96 million with 120,000 daily orders..
Coping with Covid-19
As of February 2020, HungerBox was processing 600,000 orders per day and was close to turning EBITDA positive by March 2020. By April 2020, HungerBox planned to expand its operations to 10 more cities across India; it was also expected to hit the one million order mark by August 2020. However, the outbreak of COVID-19 cut HungerBox’s dream run short. In March 2020, the pandemic halted the growth and HungerBox’s orders halved to only 300,000 orders per day..
Challenges Ahead
As of fiscal March 2020, HungerBox’s GFS were Rs. 5.6 billion and revenue was Rs. 480 million (See Exhibit V). It emerged as the leading institutional foodtech startup in India, leaving behind rivals such as Zomato’s Food@work Swiggy’s Café , Box8 , and GoKhana. Reportedly, the foodtech industry in India was poised to grow at 25-30 % to US$8 billion by 2022. Going forward, HungerBox planned to deepen its engagement with the corporate sector, expanding into sectors with massive scope for improving F&B management, such as education, healthcare (hospitals), and retail (malls), and expanding geographically beyond India..
Exhibits
Exhibit I: Product Suite of HungerBox
Exhibit II: Investor Funding at HungerBox
Exhibit III: Key Statistics of HungerBox (As of November 2020)
Exhibit IV: HungerBox Safe Café’ Product Suite
Exhibit V: HungerBox’s Gross Food Sales and Annual Revenues (in Millions of Indian Rupees)
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