United States-based Tiger Global Management has forayed into Indian quick-service restaurants by leading a Series B funding round worth $23 million (Rs 163.7 crore at current exchange rate) in Wow! Momo Foods Pvt. Ltd.
The Kolkata-based company, which operates and owns brands Wow! Momo and Wow! China, said that it had raised the funding at a valuation of Rs 860 crore ($120.8 million). This is a sharp jump from its previous reported valuation of Rs 300 crore in June last year, when it raised Rs 3 crore (around $450,000) from William Bissell, the managing director of ethnic apparel retailer Fabindia.
In a statement, the company said the funding will also provide a partial $3 million (around Rs 21.34 crore) exit to Indian Angel Network (IAN), giving it a seven-fold return with 70% internal rate of return.
In its statement, Wow! co-founder and chief executive Sagar Daryani said the company will use the capital to scale up its operations to reach a larger consumer base in the country. “This partnership (with Tiger Global) is indeed a big step forward in our endeavour to become an Indian-origin quick-service restaurant chain with an aim to go global in times to come,” Daryani added.
Wow!, founded in 2008 by Daryani and Binod Kumar Homagai, has 282 Wow! Momo outlets and 11 Wow! China outlets across 15 cities, including Mumbai, Bengaluru, Kolkata, Delhi and Kochi.
In 2016, the chain raised Rs 7.9 crore in debt from private-sector lender Bandhan Bank. Prior to that, it raised Rs 10 crore from IAN in 2015. Sanjeev Bikhchandani, Saurabh Shrivastava and Ashvin Chadha were the lead IAN investors in that round, which had valued the chain at Rs 100 crore.
Tiger Global has increased the pace of its investments in India ever since it ended a three-year hiatus towards the end of last year.
It made at least three investments last month. The investor led a $42 million (around Rs 300 crore) Series C funding round in education-technology startup Vedantu Innovations Pvt. Ltd. along with private equity firm WestBridge Capital.
Tiger Global also took part in a $120 million (Rs 862 crore) funding round in financial-technology startup Cred, and invested $15 million (Rs 108 crore) in INDwealth, an artificial intelligence-based wealth management venture.