Zomato CEO Deepinder Goyal’s Advice to Swiggy After IPO: “Complacency Can Stifle Innovation”

Swiggy’s recent IPO has not only brought financial success but also turned several employees into millionaires. However, Zomato CEO Deepinder Goyal offered a cautionary note, urging Swiggy to remain vigilant against complacency. Drawing from Zomato’s own experience following its 2021 listing, Goyal highlighted the potential pitfalls of sudden wealth within an organization.

Lessons from Zomato’s Post-IPO Phase

Speaking at the ET Startup Awards, Goyal reflected on the unintended consequences Zomato faced post-IPO. While the listing brought financial prosperity, it also led to a slowdown in innovation.

“A lot of people made a lot of money for the first time in their lives,” Goyal shared. “These are competent people. Competent people can’t recognize that they are actually being complacent. They don’t seek progress anymore.”

Goyal revealed how this complacency halted work within Zomato. “I had to literally clear out pretty much everybody who had lost that drive and then reboot the organization,” he said, emphasizing the importance of maintaining ambition and drive, irrespective of financial success.

A Growing Market with Opportunities for Innovation

Meanwhile, Zomato’s food delivery CEO, Rakesh Ranjan, expressed optimism about the sector. In an interview with Reuters, he shared Zomato’s ambitious projection of 30% annual growth for the next five years.

Ranjan also acknowledged the positive impact of Swiggy’s IPO, stating, “The food delivery sector is still in its nascent stages in the country. More competition will only foster innovation and growth, benefiting the sector overall.”

Zomato vs Swiggy: Market Share Insights

Currently, Zomato dominates the Indian food delivery market with a 58% share, while Swiggy holds 34%. Zomato’s growth trajectory is evident, with its app reporting an 18% year-on-year increase in active restaurant partners as of March 2024, averaging 2,47,000 monthly.

The Road Ahead

While the IPO marks a milestone for Swiggy, Goyal’s advice serves as a reminder of the challenges that accompany financial success. Continuous innovation, adaptability, and maintaining a growth mindset will be crucial for Swiggy and the broader food delivery sector as they navigate the competitive landscape.