and delivery part of the business this gives better margins but the challenge is to build scale with an army of chefs in various cities saurabh saxena ceo holachef says customers recognise who is making their food and this creates an emotional personal touch the centralised kitchen is an opportunity for our chefs to scale holachef operates in mumbai and pune and plans to add two more cities by end 2016 fresh menu operates in three cities bengaluru mumbai and gurgaon it has a central team of five chefs in bengaluru and the satellite kitchens have two chefs each this segment is relatively new with fewer players than its counterparts in the other food tech segments so these are early days to estimate how it is faring as is happening with other ecommerce sectors many food startups are caught in a vicious cycle to woo customers they resorted to offering deep discounts if they dont they risk losing customers reaching out to restaurants directly deep discounts delay profits that strategy itself might not always pay off because of the fierce competition and customers fleeting loyalty the food business also has a unique set of challenges a new mobile phone purchase or clothes purchased online can be delivered in one two or more days and it wont bother people but in the food business fulfillment has to be within 3040 minutes says daga besides there has to be a very tight control on quality of food and service else people will reject it customer expectations are high fixing the kitchen the business came under a cloud when a raft of players began entering the segment in a short span soon many players faced a cash crunch which eventually led to a massive shakeup of the segment even zomato was not spared on january 11 zomato announced shutting down business in four citiescoimbatore indore kochi and lucknow it runs a food ordering business in 10 cities now from a management bandwidth view these cities were not viable as we were getting just 2 of business from here we had a bigger fish to fry in other cities and hence cut back says goyal goyal does not deny that it is a tough business once the platform is there app a startup needs customers and restaurants its a chicken and egg problemcustomers wont come if restaurants arent on your list and restaurants wont come if you dont have enough customers you have to give choice to users some startups used our listing and gave a perception of choice to their users it doesnt work that way market has had a reality check says goyal zomato which has raised 225 million so far says it will break even by june fortuitously for startups the steady stream of negative news has not driven away investors according to vccedge january 2016 alone has seen three deals with around rs 300 crore being raised by food tech companies the largest was rs 230 crore raised by