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Indonesian cloud kitchen startup DishServe shuts down operations amid stiff competition

Indonesian cloud kitchen startup DishServe shuts down operations amid stiff competition

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 Cloud kitchen startup, DishServe has shut down its business and operations, according to its CEO, Rishabh Singhi.

In his LinkedIn post earlier this month, he wrote, “An incredible journey comes to an end. With great sadness I would like to announce we have shut down DishServe.”

The decision to close down its operations were based on three considerations, said Singhi “Initially our margins were low, and we focused on growth, we exhausted much of our runway doing that. By the time we improved our margins, the runway was already too tight,” Singhi wrote.
 
Furthermore, Singhi also explained that the company had a “boring F&B narrative” which is not attractive for the venture capital world nowadays. The brand was not able to convince enough people that the business could scale to a US$100 million Annual Recurring Revenue (ARR) business in the next five to six years.  
 
The third issue was that the brand tried to solve many problems at once, right from brand creation to supply chain and distribution to food production, where it could have focused on one of these areas and started to monetise it earlier. 

Saying that, Singhi noted that he was very proud of having started a fully automated food production factor with no prior experience in manufacturing, creating a network of over 200 kitchen partners and launching and scaling multiple health food brands in 10 different Indonesian cities. 

Founded in 2020, DishServe is a three-sided marketplace. The company helped F&B brands tap into a network of standardised ghost kitchens and use them as their distribution sites while also connecting F&B brands with underutilised kitchens to become ultimate distribution locations for F&B brands.

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In 2021, the company gained pre-series A funding back in 2021, with participated investors including Genting Group, Insignia Venture Partners, Stonewater Ventures, Ratio Ventures, Rutland Ventures, 300x Ventures, and MyAsiaVC.

In an effort to maintain its company operations, the cloud kitchen startup declared that it had changed its business strategy to concentrate on back-of-house automation operations for cafés, restaurants, and kitchens that exclusively provide delivery services in early 2023.

Along with integrating food delivery applications, pricing automation, promotions, financial reconciliation, inventory management, supply chain and logistics, customer service, and QR code-based dine-in, the startup was also undergoing a business transformation. However, this business strategy's attempt to pivot failed to put the company's crisis to an end and it was forced to shut down.

Related articles:
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Zomato shuts operations in the Philippines and Indonesia
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