ZFW Hospitality, which operates dark kitchens and stores under the ZFW brand, announced that it had raised $300,000 in pre-seed funding from a group of investors, including Epigamia yogurt co-founders Rahul Jain and Uday Thakker; Renee Cosmetics and Beardo co-founders Ashutosh Valani and Priyank Shah; and others.
Arjun Vaidya, founder of Dr. Vaidya’s and India’s leader Verlinvest; Varun Sheth, founder of NOTO ice cream; and Ashika, a financial services business, are other investors. This brings the total amount raised by the company to $415,000.
Rahul Jain, the founder of Epigamia, said, “The model that enables brands to reach more customers in the fastest possible time while solving for customer experiences, high RTOs, and profitability, is well-poised to capitalize on India’s $100+ billion D2C opportunity by 2025.”
The Delhi-based startup plans to use the funds to expand its dark kitchen operations into southern India, hire more people, and develop a strong tech platform. Using its network of tech-enabled dark stores across India, the company works with D2C brands to expand and deliver orders in 30 minutes, two hours and the same day.
Madhav Kasturia, a food and beverage entrepreneur who launched the startup in 2020, said it currently serves about 20,000 orders per month and expects to reach 50,000 by the end of the quarter.
“The pandemic rapidly accelerated the emerging trend of direct orders for a huge segment of the e-commerce space. We’re building a strong dark store network for D2C brands who will ride this wave. ZFW is on track to grow 10x by the end of 2022,” he said.
Arjun Vaidya, the founder, Dr. Vaidya’s, and India lead for Verlinvest said, “ZFW solves a real problem of quick fulfillment for brands using unutilised spaces. It’s a clever business model that makes sense.”
By the end of 2022, ZFW plans to open 500+ dark stores across all major metro and mini-metro markets as part of its next phase.
Dark or cloud kitchens are expected to become a $2 billion industry in India by 2024, according to RedSeer Management Consulting.