Rebel Foods And The Cloud Kitchen Story

Rebel Foods was founded in 2011 by Jaydeep Barman and Kallol Banerjee as a physical restaurant chain with online ordering facility. It launched its first cloud kitchen in 2015 and became a cloud kitchen-only business in 2016.

Jaydeep Barman wanted a more Indian take on fast food. Jaydeep and his friend Kallol Banerjee set up Faasos, an Indian wraps chain. Food discovery and delivery on internet.

The organized fast food sector was dominated by Western brands like Domino’s, which sells more pizza in India than anywhere else outside the US. In 2014 Uber pushed aggressively into India, and restaurant aggregators like Zomato, Swiggy and Foodpanda were gaining steam and made their entry into the food delivery market. There was an opportunity for a large domestic brand in the fast food category. A developer helped create the first version of the Faasos app.

The shift from a traditional fast food format to a cloud kitchen model changed the economics of the entire venture. People don’t like to order the same thing, week in and week out. As a result, customer frequency is usually low in the F&B industry for a single brand. And, usually in this category, brands are built around a cuisine. The Faasos customer saw the brand as quick desi food at affordable prices. Jaydeep Barman ran a quick survey and realized that his web and phone delivery business were indeed growing independently of the stores: 70% of customers had never set foot in a Faasos outlet.

At a Q1 2016 board meeting, when the cloud kitchen model was in full swing, we had a long discussion about how to increase life time value of a customer by boosting average order value and improving frequency through wider choice. The idea of launching a premium band, separate to Faasos, on the same platform was surfaced. After some debate, everyone jumped on board: 

They thought that they could drive a lot of synergies by turning a cloud kitchen into a multi-purpose one, using the same kitchen, common ingredients and the same staff to fulfil orders for different brands. The cost of launching a new brand online was far lower compared to launching a new brand of offline stores.

In August 2016 they launched Behrouz Biryani, which was priced much higher than original wrap offering. It quickly went national. Within one year, Behrouz was delivering 200,000 Biriyanis a month, and in less than 18 months, the brand became a $12M business with minimal investments in marketing and capex.

The cloud-kitchen model unshackled the company from several constraints of offline models. Location constraints, customer demographic constraints, scaling constraints, and even food fatigue.

Now, Faasos has 160+ kitchens that produce delivery meals for four distinct brands, including Faasos, Behrouz, Oven Story, a Pizza Brand, and Firangi Bake, which makes oven-baked dishes, like lasagne, with an Indian twist. The same customer can order a wrap for lunch and something different for every member of the family. The team is always experimenting, fielding a few new concepts at any given time.

By disrupting its QSR model and adopting technology, Faasos ended up with a platform that offers endless possibilities to drive demand, solving the scaling challenge and delivering unmatched economics.

Faasos has established itself as a leader in a new category and growing rapidly using the power of technology. Jaydeep Barman's dream, virtual Indian takeaway is being served now.