The Mumbai-headquartered Rebel Foods, which runs Faasos, is in the process of raising $75-100 million, and a deal could value the eight-year-old venture at about $400 million, they said.
Existing investors Sequoia Capital and Lightbox Venture are also expected to pump around $20 million in the new financing round, people privy to the talks said. Other crossover funds are also believed to have held discussions with the company, they said.
“The valuation expectation is high, it is almost a 10x multiple to sales that the company is asking for,” said a person familiar with the discussions.
Rebel Foods has been in the market to raise fresh capital at a time when the food-delivery sector has been awash with funds. It had earlier projected revenues of Rs 320 crore, up by 120% compared to a year ago, and expects to be
Cloud kitchens such as Faasos earn better margins compared to food aggregators like Swiggy and Zomato and brick-and-mortar restaurants because they sell their own brands and they can utilise one central kitchen to service multiple brands. Zomato and Swiggy contribute around 50-60% of Faasos’ overall orders, said a person privy to the details. But in the recent past Swiggy — which is in talks to acquire UberEats’ India business, as ET reported in its February 22 edition — has been shoring up its private brands and wants to build its own cloud kitchen capabilities, which may become challenging for a player like Faasos.Jaydeep Barman, CEO at Faasos, declined to comment specifically on the funds that were engaged in talks to invest in the company.
He, however, said Rebel Foods was in the process of raising fresh capital to tune of $75-100 million.
While Multiples PE did not respond to ET’s emailed query, Temasek, CPPIB and Goldman Sachs declined to comment on what they termed as market speculation and rumours.