- Founder: Paurav Rastogi & Shamin Kapoor
- Business: Co-working Kitchen
- Ask: ₹2 Crores for 3% Equity
- Valuation/ Networth: ₹66.67 Crores
- Funding: ₹2 Crore for 6% Equity
- Sharks: Kunal Bahl, Ritesh Agarwal & Azhar Iqubal
- Episode: Season 4 Episode 7
Speed Kitchen Shark Tank India Pitch:
Speed Kitchen is an Indian startup which focuses on co-working cloud kitchens which are specifically made for delivery only model. Their ecosystem is operational 24/7 and 365 days a year. They are also 100% compliant and hygienic & plug and plug-and-play kitchens. The founder sought an investment of ₹2 Crore in exchange for 3% equity in their company valuing the business at ₹66.67 Crores.
Speed Kitchen focuses on all the maintenance of these cloud kitchen premises. A food brand can start its business with a speed kitchen in just 4 days with low capital investment. They are available in 4 cities across India and have more than 15 locations. They currently have over 50 brands which are operating from over 130 kitchens in their facilities.
Speed Kitchen was launched in March 2021. The company first looks for real estate at a prime location; they use key matrices like Average Order Value, rider availability, and population density to pick a suitable location. Then, they do a compliance check. Then, they approach their brands and work with them to operate from there.
Speed Kitchen offers a minimum guarantee and revenue share to the brands which work with them. The founders added that all their leases are registered leases with terms from 3-9 years. Brands can run multiple sub-brands from one kitchen space. Brands provide their own equipment but all the security and maintenance is provided by Speed Kitchen.
Speed Kitchen’s Financials & Revenue during Shark Tank India:
Speed Kitchen has capped their revenue sharing at 1.5X-2.5X of their minimum guarantee. The company would need to pay either a minimum rent or a revenue share depending upon whichever is a higher value. Their revenue share threshold is between 6-10% on net sales.
The company get 15-18% return on their capital employed(ROCE). Speed Kitchen have been profitable since their inception. They made ₹32 Lakhs in their first year which was FY21-22 followed by ₹1.51 Crores in FY22-23. The company closed their last year with revenue of ₹3.25 Crores and they are projecting to close this year with a revenue of ₹5.5 Crores. They have already made ₹3 Crores by October 2024.
For FY23-24, Their revenue was ₹3.25 Crores with 4.5% EBITDA & 2.5% Profit after taxes. However, for this year, they are making EBITDA of 17%. The company have also raised ₹2.5 Crores already at a valuation of ₹20 Crores.
For site-level unit economics, 53% goes to fixed rental which gives them CM1 of 47%. Operational costs, employee costs, and maintenance takes another 30% leaving them with an EBITDA of 17%. After taxes and everything, they usually make profits of around 11%. They have a churn rate of 10-12%. They have an 80-85% occupancy rate on a portfolio level.
The founders also shared that they have worked with Chef Ritu Dalmia who was the main chef at Ambani wedding and the company helped them with the base kitchen. They also work with clients like Haldiram, TFS, Chayoos & a Shark Tank company Daryaganj.
They company still had ₹3.5 Crores in their bank when they pitched at Shark Tank. They have done total CapEx of ₹1.5 Crores. They have a CapEx of ₹1000 per square foot. Paurav owns 70% equity in the company, Shamin has 13%, 4.28% is for ESOP pool & the rest is with investors.
Speed Kitchen Shark Tank India Negotiations & Funding:
Vineeta went out due to less room in EBITDA and PAT at a high level of occupancy. Ritesh said he could help with all the real estate challenges so he offered ₹2.5 Crores in exchange of 10% equity in the business. Azhar wanted to take a bet as well so he asked Ritesh if he could join him which Ritesh accepted.
Kunal appreciated founder’s hard work to make this business work and he wanted to help them out. He gave them two offers, First one being ₹2 Crores for 8% or ₹2.5 Crores for 10% equity in the company. Aman went out because he felt like he couldn’t help with entrepreneurs with much in this company. but Paurav explained that he could use his help so Aman offered ₹2 Crores for 10% equity in the company.
The founders take a moment to think and they come back to counter the sharks at ₹2 Crores for 4% equity in the company valuing the business at ₹50 Crores or ₹2.5 Crores for 5% equity. Aman went out after this. Ritesh offered ₹2.5 Crores for 7.5% equity. He added that Azhar will join him in this offer. Kunal revised his offer to ₹3 Crores for 10% equity. Ritesh matched Kunal’s offered as well.
The founders asked that if all sharks could come in together they could do ₹2 Crores for 5% equity but Kunal suggested 6%. The other sharks accepted that offer. The entrepreneurs wanted to negotiate but Kunal refused so they ended up shaking hands on ₹2 Crores for 6% equity in the company valuing the business at ₹33.33 Crores.
Who are the founders of Speed Kitchen?
Paurav Rastogi & Shamin Kapoor founded Speed Kitchen. They are from Delhi. Paurav lived in London where he noticed a co-working kitchen. He graduated in civil engineering from VIT, Vellore. He has also worked in OYO in 2017 as well as a head of transformation.
Shamin has done is bachelors from Singapore. He worked with housing.com in performance marketing.
How is Speed Kitchen doing after Shark Tank India?
Our research in the Speed Kitchen revealed that while they did get a deal on Shark Tank India, whether that deal closed after the show is still unclear. we will update this article once more information comes to light but in the meantime, you can check out other Shark Tank India products by clicking the Amazon button below!
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