Dineout Acquisition: Key Details, Impact, and What Comes Next

Swiggy's acquisition of Dineout marks a significant move in the food tech industry. By integrating Dineout's restaurant booking and event services, Swiggy aims to enhance its dining-out offerings and compete more effectively with rivals. This strategic acquisition underscores Swiggy's commitment to expanding its service portfolio and providing a comprehensive dining experience for its users.

What Is Dineout?

Dineout, a prominent platform in the Indian dining scene, offers free table reservations and a variety of discounts and deals at restaurants. Its core services include providing information on trending restaurants, top cuisines, and top facilities. Dineout stands out in the market with its extensive selection of restaurant categories, such as Buffet, Pocket Friendly, and Pet Friendly, and its coverage across multiple cities in India. The platform emphasizes safety with the tagline "It's Now Safe To Crave!"

Who Acquired Dineout?

Swiggy is a leading online food and grocery delivery platform in India. It connects users with local restaurants and grocery stores, enabling them to order food and groceries online. Key services include food delivery, grocery delivery through Swiggy Instamart, table bookings via Swiggy Dineout, and package delivery with Swiggy Genie. Swiggy holds a dominant market position, operating in numerous cities and offering a wide range of services, underscoring its significant influence in the industry.

When Was Dineout Acquired?

Swiggy announced its acquisition of Dineout on May 13, 2022. This move comes as Swiggy aims to diversify its offerings and strengthen its position in the dining-out sector, a space where its competitor Zomato has been active. The timing aligns with Swiggy's recent strategic investments and expansion efforts, including its quick commerce service, Instamart. The acquisition is expected to close within a month from the announcement date, marking a significant step in Swiggy's growth trajectory.

Why Was Dineout Acquired?

• Market Expansion: Swiggy's acquisition of Dineout allows it to enter the dining-out vertical, which it previously lacked. This move will enable Swiggy to offer table reservations and events, expanding its market presence in the dining sector. Additionally, Dineout's network of over 50,000 restaurant partners will significantly enhance Swiggy's reach in the restaurant industry.
• Technology Integration: Swiggy plans to integrate Dineout's offerings, such as table reservations and events, into its app. This integration will help Swiggy explore synergies and offer new experiences in the dining-out category. Furthermore, Swiggy will integrate its loyalty program with Dineout Passport and its wallet with Dineout Pay, enhancing the technological synergy between the two platforms.
• Competitive Advantage: By acquiring Dineout, Swiggy gains access to Dineout's restaurant solutions, including contactless dining, discounts, and privileges. This acquisition allows Swiggy to offer a more comprehensive service to its users and compete more effectively with rivals like Zomato, which already operates a table reservation business. Swiggy's dominant position in the online food delivery market, combined with its extensive network of restaurant partners and large user base, provides it with a significant competitive advantage.

Acquisition Terms

• Acquisition Price: The acquisition price is reported to be between $120 million and $200 million.
• Payment Method: The transaction was an all-stock deal.
• Key Conditions or Agreements:
  • Dineout will continue to operate as an independent app.
  • Dineout’s founders will join Swiggy following the acquisition.
  • Swiggy will integrate Dineout’s offerings, such as table reservations and events, into its platform.
  • Swiggy will also acquire SteppinOut, enabling it to host various offline events.
  • The deal is expected to close within a month from the announcement date.

Impact on Dineout

The acquisition of Dineout by Swiggy has led to notable changes in operations and management. Dineout will continue to operate as an independent app, ensuring that its core functionalities remain intact. However, Swiggy plans to integrate Dineout’s offerings, such as table reservations and events, into its platform over the next 12 months. This integration will be complemented by the absorption of Dineout’s entire team, including its founders, into Swiggy. This move aims to leverage the expertise of Dineout’s team while maintaining operational continuity.

In terms of product offerings, the acquisition allows Swiggy to expand its services to include Dineout’s restaurant discovery and table reservation features. This strategic move enhances Swiggy’s competitive edge against rivals like Zomato. Additionally, Dineout’s extensive network of over 50,000 restaurant partners will now be accessible to Swiggy’s large customer base, potentially increasing customer satisfaction and loyalty. While specific employee and customer reactions are not detailed, the overall sentiment appears positive, given Dineout’s established brand loyalty. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly and efficiently.