Zomato has doubled its revenue and founder Deepinder Goyal says COVID-19 has made the company lean and mean
foodtechunicorn Zomatohas reported a 105% growth in revenue – from $192 million in FY19 to $394 million in FY20.
- The company has also seen its EBITDA loss widen by 5.7% from $277 million in FY19 to $293 million in FY20.
- Zomato founder
Deepinder Goyalsaid they expect to make complete recovery over the next 3-6 months.
“While COVID-19 has impacted the size of our business, it has accelerated our journey to profitability. In terms of the size of the business, COVID-19 has set us back by a year or so – but a year is only a small blip when you are building a company for the next 100 years,” wrote Zomato CEO Deepinder Goyal in a blog.
In the first quarter of FY21, with most restaurants being shut and operating on a takeaway only business, Zomato reported a revenue of $41 million and loss of $12 million.
But Goyal believes that the COVID-19 pandemic has made their business healthy. “In July 2020, we estimate our monthly burn rate to land under $1m, while our revenue should land at ~60% of pre-COVID peaks ($23m per month). We expect to make complete recovery over the next 3-6 months while continuing to maintain tight control on costs/profitability,” he wrote.
While Zomato had laid off 13% of its workforce due to the coronavirus pandemic, 75% of its employees volunteered for partial salary cuts resulting in a total reduction of 14% in payroll costs. However, the original salaries have now been reinstated and the burn rate of July includes the salary costs, said Goyal.
Meanwhile, Zomato’s FY20 India food delivery Gross Merchandising Volume grew by 108% over FY19. “ In Q1 FY20, we used to make a contribution margin of –₹47 per order; in Q1 FY21, we made a contribution margin of +₹27 per order,” wrote Goyal.
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