Entrepreneur

Penang Startup DeliverEat Expands To KL—Riding On The Back Of RM2 Million

DeliverEat is one of the more prolific startups in Penang, resilient despite the high death toll of food delivery startups around them.

Led by Leong Shir Mein and Tan Suan Sear, this team operates a food delivery startup that’s seen recognition from Cradle and pre-seed funding led by Crystal Horse Investment.

Under CradleFund’s tutelage, they’ve been able to mark out their place in the ecosystem through gradual increments, seemingly taking their time to suss out data and facts before making their move.

What started out as a bid to help brick-and-mortar restaurateurs scale into digital has since evolved into delivery as their bread and butter.

And two days ago, they finally made good on long-formed plans made since their inception.

Early this year, Delivereat secured a funding led by Gobi MAVCAP’s ASEAN Superseed Fund. This puts RM2 million into the team’s pockets, set aside for expansion purposes.

It’s now 6 months since the funding round, and DeliverEat settled on KL as the first arm of their expansion—chosen after considering the data they’ve collected from 4 and a half years operating in Penang.

As part of their strategy to pull eaters into their platform, the KL arm is currently waiving delivery fees to all of the orders at these KL postcodes.

It’s only available for KL-ites at the moment, but Klang Valley residents can take heart—Shir Mein has confirmed that they have plans to deliver to more areas in the near future.

“Once we knew that our foundations were strong, we knew that we were ready to come to KL.”

We managed to have a quick chat with the busy Shir Mein who is still in KL to oversee the expansion. According to her, their arrival here comes after a lot of “When are you going to be in KL?” enquiries.

“What we’ve been doing over the years is refining and refining,” said Shir Mein.

The team figured that they have a pretty solid base going on in Penang, after a journey looking into:

  • The riders’ interests and job fulfillment.
  • Giving merchants insight into what works for delivery versus fine dining and what are their requirements.
  • Most importantly, their customers’ tastes in food and what will their order.

They’ve aggregated these into data, and the team believes that KL’s demographics are comparable to Penang, but with higher demand for food delivery.

“I don’t have the data of what it’s like in KL because we’ve only been here for the past two days,” she said. “But we believe that the trend would be there.”

“We are doing what we’ve already done in Penang since 2012, so we’re just replicating what we have done before. Merchants have been very supportive since we have given them a track record that we’re able to perform in Penang. I think its a lot easier than a new startup on ground zero.”

To date, they’ve signed on 60 merchants with them on the KL branch of the platform.

Available for two days and counting now.

“The food delivery business has been exciting for the past 4 to 5 years. There’ve been a lot of players in KL that have come and gone so we believe that at the end of the day, it’s all about service.”

“At the end of the day, if we’re delivering Kenny Rogers, anyone else can deliver Kenny Rogers,” acknowledged Shir Mein.

And her solution isn’t revolutionary, but it makes sense.

“So the only key differentiation is that we will ensure that our customers get the food on time, and the merchants that sign up with us get the support that is needed. And we will treat our riders well.”

Here, DeliverEat’s value preposition doesn’t seem very different.

Right now in KL, the scene is dominated by foodpanda, though there have been other startups trying the waters. The main winners though are the users, as healthy competition usually results in more value for customers.

The question boils down to—who can do it better?

Perhaps we will find out soon enough.

Feature Image Credit: DeliverEat

 

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