Rapido Launches Ownly Food Delivery Service To Compete With Swiggy And Zomato In India

Rapido, a well-known ride-hailing service in India, has discreetly initiated beta testing for its food delivery service in Bengaluru. This move marks the company's first significant attempt to compete with Swiggy and Zomato in the rapidly expanding delivery market. The startup is testing its service in three key areas: Byrasandra, Tavarekere, and Madiwala (BTM) Layout, Hosur Sarjapura Road (HSR) Layout, and Koramangala.

Rapido has established a subsidiary named Ctrlx Technologies to launch its food delivery service, Ownly. Regulatory filings show that Aravind Sanka, Rapido's co-founder and CEO, along with Vivek Krishna, vice president of finance, are directors of this new entity. Although there was no specific reason given for creating the subsidiary, it might be a strategic decision to prevent potential conflicts with Swiggy. Swiggy currently holds a 12% minority stake in Rapido.

Competitive Pricing Strategy

The Ownly app is available on Google Play and offers food at prices approximately 15% lower than those on Swiggy and Zomato. This pricing strategy results from Rapido's model of not taking commissions from restaurants. Instead, they charge a fixed fee per order. Other food delivery apps charge up to 30% commission from restaurants.

Rapido's fleet consists of around 10 million vehicles across India, including 5 to 6 million two-wheelers. These vehicles are used for food delivery alongside taxi and courier services. To optimize costs and delivery times, Rapido avoids showing distant restaurants to customers and curates menu items on its app.

Market Insights and Expansion

While working with Swiggy for deliveries, Rapido gained valuable insights into peak hours and high-demand restaurants. This data will now be leveraged for their own food delivery service. Although their agreement with Swiggy prohibits contracts with Zomato or other competitors, it does not restrict using this data.

Rapido began as a bike taxi aggregator in 2015 before expanding into auto rickshaws, parcel delivery, and third-party logistics. In 2023, it ventured into the cab business to challenge Uber and Ola. The startup gained traction by offering a subscription-based model as an alternative to the commission-based approach used by competitors.

Future Market Potential

The online food delivery market in India is expected to exceed ₹2 trillion (approximately $23 billion) by 2030. Currently, Zomato leads the market with a 58% share while Swiggy holds the remaining 42%. Uber previously participated in this space through Uber Eats before selling it to Zomato in early 2020.

Rapido has raised $574 million over 13 funding rounds according to Tracxn. Operating in more than 250 cities across India, it handles over 3.5 million rides daily. Key investors include Prosus, WestBridge Capital, Nexus Venture Partners, and Think Investments.

The recent developments have helped boost Rapido's valuation significantly; last year it achieved unicorn status after partnering with Taiwanese company Gogoro for electric two-wheeler deployment as bike taxis.