Why Zomato why? – an opinion on Zomato’s acquisition of Runnr


I read that UBER Eats and Zomato are considering acquiring the GPS based food delivery company Runnr (Formerly known as Roadrunnr) and I was wondering why would anyone throw good money at them that too at a valuation of $50M and $20 M respectively.

The Runnr’s, is a story of continuous errors and pivots. They started as an outsourced delivery service provider (kind of like an Uber for deliveries) and were once the poster boys of the Hyper-Local logistics startup space in India. The fairy tale ended right there, post the Tiny Owl acquisition there have been very little written about Runnr and very less information on what their business is.

I was in Chennai in July 2016 and met businesses who were thoroughly disappointed with Runnr and their un-ceremonious exit from the city without any intimation or at-least a goodbye.  I heard the same in Hyderabad too about how they left without a courtesy call to their vendors.

What value are they going to bring to Zomato is something that we will have to wait and watch. But, what they have achieved after $20 M funding is far from satisfactory. If , Zomato / UBER Eats needs to acquire someone to add strength to their current model they can go for someone like Shadow Fax or Anything Delivered, two companies that I have been following recently.

While Shadow Fax is a well-funded company based in Bangalore.  Anything Delivered is a fast growing company with the best management team I have seen in the start-up space and is the only Indian delivery company competing internationally (Singapore, Sri Lanka and Australia etc).

It is the responsibility of the big players to show the rationale behind chasing the bad examples in the industry and adding them at ridiculous valuations while companies that actually can add value are ignored.

Author: Sathyadev IPS – freelance journalist

(The opinions & views expressed in this article are those of personal in understanding of the author & may not neccessarily express RedNewswire’s views)