Global expansion in sight for India’s Dineout thanks to inResto acquisition

From convincing Indian parents about the decision to quit fancy jobs to now making global dreams come true, Dineout’s Ankit Mehrotra talks about the startup’s journey

Ankit Mehrotra, Co-Founder and CEO, Dineout

Flying to Dubai for a meeting and want reservations at an exclusive restaurant while sitting in Mumbai with the push of a button? Delhi-based online restaurant reservation company Dineout wants to make that situation a reality soon. Dineout acquired restaurant management platform inResto a couple of months ago, which has opened a world of possibilities in the food tech space for it, including global expansion.

e27 caught up with Dineout Co-founder Ankit Mehrotra about the company’s expansion plans and how it tackles competition.

“When we acquired inResto, it already had customers in Singapore and Oman, who were using the platform. So we know that there is a market out there; it’s just about taking a call when do we expand there. So we will see in the next six months how things work out in the Indian market,” says Mehrotra.

Started in January this year, inResto is pegged to be the game-changer for Dineout, who is now facing competition from companies like EazyDiner, which raised US$3 million in August and Zomato, which recently entered the restaurant reservation space NexTable in the US.

While in the domestic market Mehrotra shares the Times Internet Ltd-backed company will restrict itself to the eight cities it is present in, its global ambitions will be fulfilled through inResto with an integrated app.

The company claims to have listings of over 20,000 restaurants, and real-time reservation enabled at over 2,000 restaurants in the prime cities of Delhi-NCR, Mumbai, Bangalore, Pune, Chennai, Kolkata and Hyderabad.

“inResto is not a national product; it’s a global product. We can integrate with any POS (point of sales) provider, with any table reservation provider anywhere in the world. There is already an existing market in Southeast Asia which is untapped. For example, Open Table is a global leader; it is in the US, Europe, Australia, but the Southeast Asian market from a tech perspective at a restaurant level is very untapped,” says Mehrotra.

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The acquisition of inResto in September enabled Dineout to provide a single dashboard for restaurants to manage table reservations, home delivery, takeaways, customer feedback, mobile payments and loyalty programmes.

“With an integrated chain you can book a restaurant in Dubai sitting in Delhi. The inResto platform is an Android-based platform and it runs on any tablet. So a restaurant [owner] in Dubai can download the inResto app and set it up himself. Connecting the POS doesn’t require us to be present; it is all done through APIs,” explains the Co-founder.

(L-R) Vivek Kapoor, Ankit Mehrotra, Sahil Jain and Nikhil Bakshi

Competition

Founded in 2012 by four childhood friends Vivek Kapoor, Ankit Mehrotra, Sahil Jain and Nikhil Bakshi, Dineout was acquired by Times Internet in April 2014. According to media reports, the deal was valued at US$10 million.

“What makes us stand out is that we are the oldest from among the names you mentioned and we’ve been there and sustained ourselves,” says Mehtrotra, who left his job as an investment banker in London to set up Dineout with his friends at a time when restaurant reservation was not considered important in India.

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Quoting statistics from the Indian Restaurants Association of India, Mehrotra says while around five years ago probably five per cent of the people would call in and book a table, now 20-25 per cent of all dining is booked.

So how does the recent entry of EazyDiner and Zomato change the dynamics of the restaurant reservation space?

“You need competition, so over the last few years we have realised that competition has been coming up, but it just faded away. With Zomato and EazyDiner both…now the fun begins. Earlier we were the only ones to say come and reserve a table. Now there are two other players who are saying that, so automatically the reach increases. Whoever gives the best deal and service to the customer [wins],” says Mehrotra.

And how does Dineout stand out?

“Indians love discounts. In every other industry — be it e-commerce or food delivery — all the players were funding their own discounts. One of the things we have done really well is get very good discounts from our partners. So 99 per cent of the restaurants on our network have discounts,” he says with a proud smile.

He also stresses the importance of customer reviews and how a bad experience by a customer is addressed.

“If you have a bad experience, we take it directly to the restaurant and make sure that the restaurant does something. That, from the customer standpoint, is a very powerful tool. It just increases our stickiness with the customer,” he adds.

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Revenue and profit

“Right now no heavily-funded company is making profits. One of the things we did well was generating money from day one. We are in the fulfillment business and we were not relying on the advertisement side of it. Every time someone made a booking, the restaurant paid us,” explains Mehrotra.

The company also offers a concierge service for booking in bulk, wherein it acts as an escrow between the customer and restaurant. The customers give details of the number people, budget, cuisine, location, etc. and Dineout provides choices and helps to decide and book a restaurant, along with help in deciding the menu.

The inResto platform is the most recent addition to its revenue stream.

“When we got acquired, we were breaking even, but now over the last one year, we have expanded a lot. Delhi as a market for us breaks even. The other markets are obviously going to take a lot more time, with the inResto acquisition as well. From a revenue perspective, we have a good plan in place, where we are going to earn a good revenue,” he says.

So is the breakeven in near sight?

“That for us right now is not as important a factor as getting more and more people to use our service and getting more restaurants on board. We are not so focussed on profitability right now. It about stabilising the business,” says Mehrotra.

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Speed bumps

“The toughest hurdles in setting up and expanding Dineout were not the restaurants, customers, funding or finances,” laughs Mehrotra. The first issue to tackle was convincing their parents, who according to him were not happy about him or the other co-founders leaving their fancy jobs in different parts of the world to start their own business in India.

“For the first six months, our parents couldn’t understand why someone would leave their jobs in the UK and US and start a business in India. The first stepping stone happened when we got the angel money; so they thought that if someone else is investing, then we must be doing something right,” he says with a smile.

Having physically removed water out of their basement office during heavy rains to dealing with employees stealing data, Mehrotra says getting a phone connection and then getting it transferred to a new office still tops the list of difficulties in running the business.

“As the business expands, you start to lose control of a lot of things,” he concludes with a sigh as he sips his glass of water.

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