Malaysian food delivery startup dahmakan, a Y Combinator graduate that raised $2.6 million early this year, has acquired Bangkok-based competitor Polpa for an undisclosed amount, as part of its aggressive regional expansion plans.
Jessica Li, co-founder of the Malaysian startup, told DEALSTREETASIA that Polpa has been integrated into the dahmakan brand following the acquisition. The Thai startup’s founders, Dr Julian Timings and Prongfa Uennatornaranggoon, have joined dahmakan’s executive team.
“This will be the first of our three city expansion in Southeast Asia in 2018, with Jakarta and Hong Kong slated for Q3 and Q4,” Li said.
According to dahmakan, Southeast Asia is a region where demand for online food delivery has grown 20 fold in 2017, and where online spending is projected to quadruple by 2025.
dahmakan CEO and co-founder Jonathan Weins said getting into Bangkok, the third largest city in Southeast Asia, was strategic.
“Bangkok has millions of office workers, high urban density and a lack of convenient food delivery options which makes it an attractive market. We believe it will become our fastest growing market in a matter of months,” he said.
According to research firm Euromonitor International, Thailand’s online food ordering market is on track to hit THB31.7 billion (about $1 billion) in 2018. The forecast market size is more than double the market value in 2014. For the entire Asia-Pacific region, the market for online food ordering is estimated to reach $87.5 billion this year.
Established in 2014, Polpa claims to be among the market leaders for healthy food delivery in Bangkok.
Since launching in 2015, dahmakan has raised over $4 million in venture capital funding. Investors include Y Combinator, Atami Capital, Texas Atlantic Capital, Asia Venture Group and high profile angel investors such as the ex-CEO of Nestle, the Chairman of the Rocket Internet Board and the ex-Founding Partner of APAX Partners Asia.
The Kuala Lumpur-based startup distinguishes itself from rivals – including Foodpanda, UberEats, and Deliveroo – by delivering meals prepared in-house instead of picking up from restaurants and stalls.
Competition in the meal delivery space in Bangkok is expected to heat up as Indonesia’s Go-Jek and Roofoods’ Deliveroo are expected to launch services this year. Already, Foodpanda, Line Corp.’s Line Man and Uber Eats are using aggressive promotions, such as free delivery or discounts, to woo customers. Other players include Grab and Vietnam-based Foody’s Now service.