Update: Since the time of publication, e27 has received updates regarding foodora. The article has been edited to reflect those changes.
There is a new meal delivery service in town, wheeling around in its bright pink glory, and it is also Rocket Internet-backed.
Foodpanda, born out of Berlin-based Rocket Internet, expanded to Hong Kong just June of last year. Now it’s sibling foodora has launched quietly in Hong Kong, rolling out its website in August and on iOS last week.
Both operate on the same premise: Too lazy, tired or simply don’t have the energy to muster going outside? Order food online, pay ahead of time and have your meal delivered to your home from a restaurant that otherwise does not have courier service.
So what’s the difference between these siblings startups, and how much appetite is there for meals on wheels in Hong Kong’s delivery startup scene?
The two companies are targeting different clientele, according to Chris Parrott, Managing Director of Marketing at foodora.
“Foodpanda is a sister company, so there is scope for knowledge-sharing. We have different target clientele, as our minimum basket size is US$15.4 (HK$120) and foodpanda’s is variable,” said Parrott.
Foodora is targetting a more high-end, corporate clientele in a city it sees as having a demand for reliable and fast food delivery. Its focus is getting your meal from an upscale venue delivered to your door – in 30 minutes flat – without hassle. The delivery time for foodpanda varies, based on location.
While foodora is 100 per cent backed by Rocket, foodpanda independently raised US$100 million led by Goldman Sachs in May 2015. Previously, it had secured US$110 million led by Rocket Internet.
Since its launch in 2012, foodpanda has raised a combined total over US$310 million.
Hong Kong is just one piece of the pie
Though foodora just launched in October 2014, it is active in 14 countries.
It merged with Delivery Hero earlier this month. Delivery Hero doesn’t have presence in Hong Kong, but it does operate in 34 countries, including China and Korea.
foodpanda is currently available in 40 countries, with a focus on Southeast Asia. It also operates as Delivery Club in Russia.
“We took the core of the foodora team from London to Hong Kong,” said Parrott, after the startup struggled in the UK market due to considerable competition.
As for marketing, foodora has been reaching out to food bloggers and Instagrammers in Hong Kong.
“Facebook and social media are a huge part of daily life in Hong Kong. [The] main channels are Facebook and Instagram. Twitter is not as popular in Hong Kong, compared to London,” said Parrott.
At the moment, foodora’s delivery services are available only in Sheung Wan, Central and Admiralty. Foodora is working together with popular restaurants in the district, such as Fatty Crab, Linguini Fini and Dragon-I.
The company is planning to expand the delivery area to Tsim Sha Tsui, Wan Chai and Causeway Bay and extend the list of restaurants, currently under 150, to 400 by the end of 2015.
The next zip code it is planning on hitting? Singapore.
Foodpanda certainly hasn’t had any problems with scaling, though its struggles lie elsewhere. As e27 has reported, foodpanda has come under scrutiny for allegedly listing fake restaurants and skimping on employee pay.
Nevertheless, foodpanda continues to grow internationally. In Singapore, the startup announced just last week the completion of acquiring Singapore-Dine. (The merger was originally announced in 2013).
Within Hong Kong, foodpanda has also acquired a main player in the delivery service scene, Koziness.
The service had earlier acquired food delivery player Dial-a Dinner, which has been in business for a decade. This acquisition has consolidated competition, meaning that foodpanda has a huge monopoly on the food delivery scene.
Aside from Rocket Internet’s creations, there are others vying for a spot in Hong Kong’s food delivery scene, marketing to the eager, busy urban consumer.
Perhaps most interesting to watch out for is Delivery Republic, which covers Hong Kong Island, Kowloon and parts of New Territories. The logistics tech startup provides the service directly to the restaurant primarily through its app, instead of having the customer order through its site. About 200 restaurants have signed up for Delivery Republic’s service.
In any case, restaurants in Hong Kong have a lot to gain as well, with an option to make additional revenue with no extra overhead.
Given Hong Kong’s fast turnover of restaurants, no one delivery service can comfortably have its cake and eat it too, for too long.