ndian Angel Network (IAN), a network of over 200 business angels investing in start-ups and early stage ventures, made an undisclosed investment in Poncho, a Mumbai-based Mexican quick service restaurant. IAN investor Kaushal Aggarwal led the investment and investors like Saurabh Srivastava have invested in this round in Poncho.
IAN’s investment will help Poncho, founded by IITians Amit Raj and Anshul Gupta in August 2011, to scale up by opening new outlets, strengthening the back-end operations and ramping up the core team, a company statement said. Poncho has opened 6 outlets since its inception and plans to reach 15 by the end of this year.
The entry of renowned international brands and celebrities and rapidly growing eating-out habit have made restaurant sector a hot investment destination for Indian private equity/venture capital investors.
Major Indian PE/VC firms already have wider exposure to small and mid-sized QSRs. The Chennai-based TVS Capital has investments in Om Pizza (runs Papa John’s pizza chain) and Indian Cookery (runs the Yellow Chilli brand of restaurants of chef Sanjeev Kapoor). New Silk Route (NSR) is planning an investment to the tune of $100 million to expanding its food and restaurant portfolio. In May 2012, NSR invested in Bangalore-based restaurant chain Adiga’s.
Kaushal Aggarwal, an IAN member and co-founder & Managing Director, Avendus Capital said, “Food and beverage space has lately gained a lot of attention from the investors. Exclusive services and products are being offered by the start-ups in this sector.”
Other PE/VC deals that took place in restaurants space this year include Navis Asia’s investment in Nirulas Corner House, Verlinvest SA’s investment in Cuisine Asia. Last year, ICICI Ventures invested in RJ Corp’s Devyani International that runs KFC, Pizza Hut and Costa Coffee chains. The Delhi-based Sagar Ratna, a restaurant chain serving South Indian cuisine across the National Capital Region, raised $35 million from India Equity Partners.
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