Zepto to launch ‘Zepto Cafe’ app as 10-minute delivery battle heats up

Amid rising competition in the food-tech space led by Zomato and Swiggy, quick commerce major Zepto has said it will launch a separate app for Zepto Cafe, which is its 10-minute food delivery unit, next week.

Zepto co-founder and CEO Aadit Palicha, in a social media post, said: "We're launching a separate app for Zepto Café next week! The team is shipping an MVP and iterating quickly, so it may not be perfect on Day 1, but it's worth it to launch fast."

He says Zepto Café is scaling rapidly, with around 100+ café launches a month. "We are already clocking 30K+ orders/day," says Palicha.

According to Chandan Mendiratta, chief brand officer and chief culture officer at Zepto, the Zepto Cafe has already been launched in key cities like Gurgaon, Delhi, Mumbai and Bangalore. "(People can now order fresh food delivered in 10 minutes...have you tried Zepto yet? Do tell me in the comments which one is your favourite. Soon to be in more cities!" he said.

Zepto was India's first unicorn of the year 2023 after the company raised $200 million at $1.4 billion valuation. The company has been on a fund-raising spree this year. In June, the company raised $665 million in funding at a $3.6 billion valuation. The company raised around 340 million in August as well, with participation from investors like General Catalyst, Dragon Fund and Epiq Capital. In November 2024, the company raised around $350 million at $5 billion valuation.

“Flipkart took four years to hit a $1 billion top-line. We did it in 2.5 years, with a fraction of the capital,” Palicha told Fortune India magazine recently.

Zepto clocked ₹10,000 crore in calendar year 2024, as per company sources. Its gross order value was $1.5 billion as of September 2024. They have grown on the back of a steady rise in average order value from ₹100-150 in 2020, when they started gaining acceptance, to ₹450-600. This is encouraging them to set up 2,500-3,500 sq.ft. dark stores (every incumbent has 500-600 dark stores) near consumers with 10,000-20,000 stock-keeping units (SKUs).

“Our business was EBITDA positive in Q1 of FY25. We recently raised $1 billion. Instead of reporting short-term profitability, we decided to expand dark stores (currently 639). EBITDA will fluctuate but we will be back to profitability once the stores mature,” said Palicha.