Everything you need to know about Tinyowl- The Ex-rival of Zomato and Swiggy


Tiny owl, does the name ring a bell? Tiny Owl used to be the Ex-rival of Zomato and Swiggy! The  blue-eyed food-tech dream of five IIT-graduates went belly up in a disgraceful manner in 2016 and it shut down its country-wide operations. When a well-funded company goes through distress and then gets acquired, it becomes a talking point. Tiny Owl’s sad demise was a lesson to be learned from one of the biggest startups in the Indian economy. Here’s all you need to know about the rise and fall of Tiny owl.

Source: Google

The Beginning

                                                                                                                    Photo credit: Super Personal Recruiter via YouTube image grab.

It all started with 5 men  (IIT alumnus) from Housing.com. Sourabh Goyal was one of the 12 co-founders of Housing.com who left the startup in 2012 and joined the 2 co-founders of TinyOwl – Harshvardhan Mandad and Tanuj Khandelwal, along with Gaurav Choudhary and Shikhar Paliwal, to make the core team of TinyOwl.

The main focus of these men was to create an app that would be the perfect mix of food and tech to ensure seamless food delivery. In 2012, the Indian food delivery market was fresh and just waiting to be tapped into and investors roared at this idea.

The good times: fundraising  

                                                                                                                                                                                                                          Source: Google

Within less than a year, the Mumbai-based TinyOwl managed to get into the food tech mainstream. Harshvardhan Mandad, the young co-founder and CEO of TinyOwl was among those prominent faces behind this rapid growth. His primary job was fundraising.

TinyOwl ran 4 total rounds of funding between 2014 to 2015 and big investors pitched in. Companies like Sequoia Capital India and Matrix Partners were vying for a piece of the pie. These investors together raised a whopping $27.7 million in total over just two short years, which set a very successful financial benchmark for the company.


Now, when big amounts of funding came in, the team decided to go in all guns blazing. They decided to hire, scale, and expand in whatever capacity they could. Soon, the company was open and operating in 11 cities in India and had a strength of 600 employees. TinyOwl reached more than 4,000 restaurants listed on its platform, with about 2,000 daily orders. TinyOwl stood as a live paradigm for the then emerging food tech array. It was predicted to have a promising future in the marketplace.

The Downfall:

One day, in late 2016, a major chunk of TinyOwl users received a notification alert on their phones:

“TinyOwl services shall be discontinued in your city starting from 22nd May”.

This alert went out to everyone in the 11 operating cities, except for a few areas in Mumbai where TinyOwl was headquartered.


So, what exactly went wrong?

The Founders Weren’t Equipped

The 2 co-founders, Harshvardhan Mandad and Tanuj Khandelwal, along with the other three members of the core team were all inexperienced and young. All 5 of them were between 22 to 24 years of age when the company received funding and blew up. They had 600 employees and multiple cities to look over, but didn’t have enough knowledge or industry know-how. While most of their initial focus was on the product and the tech, it should have shifted to operations once the company started scaling. But, that didn’t happen.

Excessive Cash Burn

Getting almost instantaneous funding, and a LOT of it in a short time, led to pressure on the company and the founders. The best way to increase performance, according to the company, was to spend more money on more avenues. But, this was done without having efficient systems in place.

They spent too much and in order to reduce costs, they had to undertake massive rounds of layoffs which didn’t go down well in the industry or with their employees. 

Not Knowing What The Company Needs

Each company runs on a certain set of core metrics. If you’re an e-commerce company, then metrics like average order value, time spent, and conversion rate are important metrics to look at.

The folks at TinyOwl, because of their aforementioned lack of experience, didn’t know what their key metrics were. Was their average delivery time increasing and thus, did they need to hire a new fleet? Or were their services being demanded in more cities? Or did they need new partner restaurants in already existing cities? The founders didn’t seem to have answers to these questions.

The End

The company tried to tackle everything all at once instead of prioritising, which let the focus go a little haywire. Thus, a great company and a stellar idea were left in inadequate hands which put every bright possibility in jeopardy. The startup was soon acquired by Roadrunnr and the original brand shut stores. The merged company then called Runnr itself was facing operational problems and was later acquired by zomato. 

Thus the Mumbai-based food tech business flew high and fell deep on the back of a few bad decisions. It failed to sustain amidst chaos.

There are many startups out there that had to withdraw midway. The rise and fall of TinyOwl set a lesson to be learnt for the Indian startup community. It just goes to show how integral instinct and experience are for the success of a business.


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