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Food Entreprenueurs: TastyKhana

Posted on Saturday, Apr 17th 2010

By guest author Erika Valdez

Known for being a country in which home-cooked meals are highly valued, India prides itself on being a society in which food traditions stand strong. Yet fast food restaurants such as McDonald’s and Jumbo King have not only made an entry into the market but have prospered. There is also growing demand for more sophisticated options among young Indian professionals and families who enjoy Sunday brunches and discovering new restaurants. The expansion of fast food chains into India’s smaller cities and towns and the demand for premium brands across major cities has resulted in strong growth in recent years. What’s more, India is the world’s second largest producer of food next to China, and according to McKinsey & Co, the retail food sector in India is likely to grow from around $70 billion in 2008 to $150 billion in 2025. The company has the potential to be a leader in the food and agricultural sectors, according to the Food Industry of India, and one of the most promising sub-sectors is fast food. This situation creates a large number of fast-growing food markets.

The next story profiles TastyKhana, an end-to-end solution provider for any food-related requirement in Pune. Aside from being known as the cultural capital of Maharashtra, Pune has a large number of restaurants that serve cuisine ranging from Italian to continental . This is where TastyKhana comes in.

TastyKhana founders Shachin Bhardwaj and Sheldon Dsouza decided to venture into India’s vast food industry in 2007 when Bhardwaj noticed the need for more Web-available information on the city’s restaurant sector. The company started as an online food-ordering website that offered menus of restaurants so that customers could easily order from the menu. TastyKhana’s ­– khana is the Hindi word for “food”– services expanded to include food delivery anywhere in Pune (the company picks up and delivers food through any of its associated restaurants), table reservations at any of the restaurants on the site, and party venues for those who wish to hold private events.

Both founders grew up in Pune and graduated from the Maharashtra Institute of Technology at Pune University, and both had a totally different career before taking this path –Bhardwaj was working as a quality control specialist in Synygy Inc and Dsouza was a software developer at an embedded system company called Codito.

TastyKhana was initially founded with personal savings from both of the founders, angel investors, and the help of friends. According to Bhardwaj, a combination of bootstrapping, angel funding, and extraordinary mentorship were key to the making of this company. The first round of funding was a pre-revenue stage, yet the big change occurred in October 2008 when the business model was changed to incorporate a food delivery service with delivery managed by TastyKhana. This was done through the acquisition of a small delivery service provider called Food on Wheels. This acquisition significantly changed the model of business and helped the founders to ramp up revenues by ten times their initial numbers. Bhardwaj says that the acquisition of Food on Wheels was the milestone in the two-year-old company’s change from online listing service to an end-to-end service provider.

Bhardwaj’s roles in the company include being involved in building relations, marketing, strategy, and operations. Dzousa handles the technical sector by focusing on building a scalable architecture for the company’s back end.

Restaurant referrals and word of mouth have been the primary ways in which TastyKhana has found its customers. The restaurant themselves provide such leads since they outsource the delivery service to TastyKhana—when a customer calls a restaurant, the call is automatically re-directed to the company.

TastyKhana addresses the needs of for restaurant owners who are unable to manage their own delivery service—outsourcing the delivery services makes excellent business sense, and it helps the company generate additional revenues at no additional cost. According to both founders, the outsourcing of delivery is what has contributed to the company’s current position.

There are currently about 30 employees (including 20 delivery boys). TastyKhana averages 60 orders per day (and increasing) and has catered to about 20,000 customers to date. Annual revenues are approximately $100,000. Goals to meet by this year’s end are to stabilize the business, prepare the infrastructure (both in terms of technology and people), and eventually go to a pan-India level. The company is and has been online partners with brands such as Kingfisher and BigFlix in Pune and recently signed up with McDonald’s to manage McDelivery from one of the restaurant’s outlets in Pune.

“From a customer perspective, the non-fast-food cuisine is a huge untapped home delivery market which is currently unorganized,” Bhardwaj explains. Such a market provides a large number of opportunities for businesses such as TastyKhana. At the same time, Bhardwaj and Dsouza agree that the entrepreneurial path has not been simple. It is extremely stressful and time-consuming. One has to be prepared to spend time away from family to deal with everyday issues. “In our society, failure is never acceptable – it is a kind of stigma that stays associated with you, and more than the entrepreneur it is the parents who are affected,” Bhardwaj explains. Yet both agree that this has been an amazing and thrilling experience. Learning everything from scratch has taught them how to operate everything that makes up TastyKhana, from hosting a user-friendly website to resource management. “The hand-on experience that one gets as an entrepreneur, no MBA can provide. As an entrepreneur you really become an expert at multitasking, which is very important during the initial stages of any startup,” said Dsouza.

As usual, I wanted to hear their opinion and advice for people who are planning on taking the entrepreneurial route. Bhardwaj believes that it is really up to each person to decide if he or she is ready to take up this task. “You will get 100 different pieces of advice from various people, but my take is you are ready when you realize that this is the only thing that you want to do.” Overall, both agree on the importance of having a plan and knowing that while the path is not going to be easy, at the end of the day it will be extremely rewarding. I agree and also believe that it is about finding the right market niche to be in. “The Indian market has great potential for the next generation of entrepreneurs; there are a lot of untapped areas that need to be explored. People with good ideas should go forward and implement them. It just requires focus, hard work, and dedication. Some may fail, but the experience will last for a lifetime,” said Dsouza.

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Very interesting article. But I am not able to understand that how a person can order food online specially in India. We indians are very specific about food taste. Every dish is defined not by its original taste but by persons own taste. Its difficult to specify order instruction thru written communication.
Anyways it good to see tastykhana is tryin to change scenario.

Sukrat Ray Saturday, April 17, 2010 at 10:07 AM PT

@Sukrat, I would guess that most delivery requests for TastyKhana are by people ordering from restaurants that they already know, and dishes that they’ve tried before.

Navin Kabra Saturday, April 17, 2010 at 10:06 PM PT

Sukrat,
Thanks for your comments but you yourself are trying to promote your business through online ordering. It would be a slow transition but a sure one.
Online ordering is the future and there would be a lot of demand for the same in the next 5 yrs.

Vinamra

Vinamra Pandiya Saturday, April 17, 2010 at 11:46 PM PT

Way to go boys! 🙂
Tasty Khana’s service is real world class and I have experienced it myself.
Good going! 🙂

Tanaya Sunday, April 18, 2010 at 10:30 PM PT

Way to go Shachin Bhardwaj and Sheldon Dsouza! Its great to see people with such entreprenuerial spirit transforming the retail food sector.

Nisarg Shah Sunday, April 18, 2010 at 11:43 PM PT

Its a great concept. It is most often a pain specially in the summer to go out and eat at your fav restaurant. More often than not, you have to compromise with a pizza, a burger or food available in your vicinity. Thanks to Tasty Khana….ordering food has become so simple..and what more… you can order from your fav places… good going. All the best!!!

Tanima Monday, April 19, 2010 at 12:14 AM PT

Great concept. hope it spreads throughtout the country & motivates more young entreprenueurs, especially ones without a business family background.

girish shenoy Tuesday, April 20, 2010 at 7:34 AM PT

Great going , I have used their service and its really good. All the best. I would encourage more people from Pune start using this service 🙂

Amit Wednesday, April 21, 2010 at 2:10 AM PT

TK rocks on! India here we come.

KT Wednesday, April 21, 2010 at 3:20 AM PT

One way to go viral for you guys is:

Offer points for people referring friends. Some scheme where you give them a point based on how much they order. They can then encash these points based on a minimum (say pints worth Rs. 50) and credit them when they order next time. This way you will have a viral concept in place, with your customers getting you new customers! Good Luck. -santosh

Santosh Bhandarkar Wednesday, April 21, 2010 at 9:27 AM PT

you people are doing wonderful creation lucky guys, keep it up.I am syamala a food lover, and also a good cook . i am intrested to start a parcel house with traditional coffee and good south indian snacks with my touch. my place is in westen orissa a small place with 60 000, population it s basically a industrial belt and how should i start in small scale. suggest me . what i need
Thanking you
syamala

A.T. Syamala Wednesday, April 21, 2010 at 11:41 PM PT

Surprising! While Tasty Khana has a good record, the customer service of Food-on-Wheels is pathetic and its employees are prone to cheating!

Suggest all those who order from Food on Wheels to double-check all dishes when taking delivery and only then make the payment.

If you discover any dish/es that are "missing" in the food parcel (for which you were billed & have made full payment), forget a refund, or even an apology! Rather, be prepared to be rudely told they don't value your business!!

Ramesh Sharma Tuesday, July 5, 2011 at 1:45 AM PT

Interesting site, guys (the founders I mean). I got to know of it quite late – only in the last few days – by seeing a poster for it at a restaurant I go to. But it seems like a good idea.

I blogged about it here:
http://jugad2.blogspot.in/2012/06/tastykhanain-in

Good luck to you.

Vasudev Ram Wednesday, June 6, 2012 at 3:19 PM PT

Great!! Wonderful Put up, very Informative but Tastykhana.in is Only working in Major Cities in India.

Sumit Choudhary Saturday, September 29, 2012 at 12:44 AM PT