STOQO, a marketplace for small restaurant and hotel owners, has shut down its operations after reeling from the effects of the COVID-19 outbreak, DealStreetAsia has learnt from multiple sources.
The company raised its Series A round in 2018 co-led by Monk’s Hill Ventures and Accel Partners India. While the exact corpus that it garnered at that time could not be ascertained, it was understood to be in the region of $3-5 million.
According to one of our sources, the company made the decision to cease its business operations due to financial difficulties brought about by the pandemic.
“COVID-19 has made the tight cash flow of the business untenable. It has directly impacted the customer base of small restaurant owners. Given the uncertainty of COVID-19 and with revenues falling significantly, the company was no longer in a position to operate further,” the person said.
We have reached out to STOQO for comments.
Founded in 2016, STOQO is a platform that aims to streamline the F&B business supply chain by providing a one-stop application that helps culinary businesses order ingredients daily and have them delivered to their kitchen.
It is understood that the company, whose customer base largely consists of restaurants and eateries, has been badly hit by the virus, which prompted people to stay home.
Things worsened for F&B players when the health ministry enacted a large-scale social distancing (PSBB) regulation, which requires all workplaces, except those in essential sectors to be closed and implement work-from-home policies. Though food counts as one of the essential sectors, most restaurants are located in malls, which have largely been closed in compliance with the regulation.
According to DealStreetAsia sources, STOQO was earlier in the process of raising a new funding round to expand its business.
Prior to its Series A round, STOQO secured its first external funding primarily from Alpha JWC in November 2017 followed by an investment from Yinglan Tan-led Insignia Ventures Partners.
The coronavirus pandemic has paralyzed several businesses with travel-linked sectors being the worst hit. Recently, Traveloka laid off over a hundred employees, while budget hotel company Airy and travel-photography startup Sweet Escape have also cut a considerable amount of jobs to survive the crisis.
These are not the only ones. Indian hospitality firm Oyo Homes & Hotels (OYO) that forayed into Indonesia in 2018 is reportedly looking to shut down operations of its co-living arm, OYO Life, in the archipelago. The startup has reportedly retrenched over 200 people in Indonesia. Globally too, it has resorted to job cuts in markets such as the US and China.