Rapido’s Food Gamble, GST Blessing For EV Makers, and Head Digital Works’ Lay Off

For nearly a decade, Zomato and Swiggy ruled India’s food delivery market with a model that restaurants tolerated but never loved. Their take rates - often 16% to 30% of order value - became industry standard, justified as the cost of marketing, customer acquisition, and maintaining a massive delivery fleet. Restaurants grumbled, regulators circled, but the duopoly held firm. Until Rapido decided to walk in with “Ownly,” its zero-commission, flat-fee challenger.

Rapido’s pitch is simple: let restaurants keep more of what they earn, while customers get lower menu prices. Instead of a percentage commission, it charges fixed delivery fees, backed by a four-million-strong bike fleet already running rides across India. This logistics-first approach solves a problem that killed past challengers like TinyOwl, Yumist, and even Amazon Food - high burn and inefficient fleets. By tapping into idle capacity, Rapido doesn’t need to build an empire of delivery boys; it just needs to redeploy the riders it already has.

The impact was immediate. Restaurant bodies like the NRAI, long resentful of aggregator commissions, quickly welcomed Rapido’s entry. Investors took notice too - the news clipped stock prices of incumbents, reflecting real concern that take rates could come under pressure. And Swiggy, which ironically holds a 12% stake in Rapido from a logistics partnership, suddenly found itself invested in a rival it now wants to sell out of.

Zomato and Swiggy aren’t sitting idle. They’ve already begun a pivot: hiking platform fees on consumers (Zomato from ₹10 to ₹12, Swiggy as high as ₹15 in some markets). It’s a clever sleight of hand - shift the monetization burden from restaurants to customers, who are less sensitive to small, fixed charges. But there’s a ceiling here too; add GST, inflation, and consumer fatigue, and those ₹12 fees begin to look like real money.

Zomato has begun talks with restaurant partners to restructure commissions and fees, even introducing a new “long-distance service charge” on orders beyond 4 km. With Rapido’s flat-fee model putting pressure on the old structure, these negotiations signal that the commission war is already forcing incumbents to rethink how much they take from restaurants.

The broader battlefield is also shifting. Both incumbents are betting heavily on quick commerce - Blinkit for Zomato, Instamart for Swiggy - using grocery orders to keep fleets busy in food’s off-peak hours. Losses remain steep, but the logic is clear: spread delivery costs across multiple verticals, cross-subsidize, and keep consumers locked into your app. Rapido, meanwhile, is lining up with ONDC, where its logistics strengths could make it the government’s de facto partner. If that happens, the challenger won’t just be a Bengaluru pilot; it could suddenly have a national platform at its back.

What follows may not be an all-out price war, but a deep reset of the business model. One scenario is hybrid: Zomato and Swiggy selectively cutting commissions for key restaurant partners while raising consumer fees to balance out. Another is segmentation: Rapido carving out Tier 2 and Tier 3 markets and hyperlocal vendors, while the duopoly focuses on premium, high-value orders in metros. A third is the elusive “everything app” play, where food, groceries, and experiences all converge, though history suggests complexity can drown such ambition.

Either way, the commission war is no longer avoidable. Rapido has forced Zomato and Swiggy to admit what restaurants always knew - that the old model was unsustainable. Whether this triopoly leads to a fairer equilibrium or just a reshuffled fee structure remains to be seen. But for the first time in years, the menu of Indian food delivery economics has changed. And this time, restaurants may finally get a bigger slice.Let’s go through what else is happening in Indian startup world - Grab your simmering cup of StartupChai.in and unwind with our hand-brewed memes.

“Thodi Sahuliyat Mile”: GST Council Retains 5% Tax Slab For All EVs

The GST Council just gave EV makers and buyers a breather by keeping the tax slab steady at 5% for all categories, from budget scooters to luxury cars.

This puts to rest the buzz about premium EVs facing higher taxes. With India’s EV market racing toward a $132 Bn opportunity by 2030, the smooth ride continues for now.

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“Jeene Ke Hai Chaar Din”: A23 Parent Head Digital Works To Lay Off 500 Employees

A23’s parent, Head Digital Works, is hitting the reset button with a massive layoff of nearly 500 employees, about two-thirds of its workforce.

Only around 200 people will remain as the company trims down to rethink its game plan. Interestingly, it’s also scouting opportunities beyond gaming, hinting at a possible pivot into new businesses.

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“Dhoom Macha Le Dhoom Macha Le”: Cabinet Clears INR 1,500 Cr Scheme To Boost Critical Mineral Recycling

The Cabinet has approved a ₹1,500 crore scheme under the National Critical Mineral Mission to turn e-waste and battery waste into a resource goldmine.

The plan focuses on recycling to extract critical minerals essential for India’s tech and clean energy push. Think of it as giving discarded gadgets a second life while fueling the country’s green ambitions.

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1. Coliving startup Colive has raised $20 Mn in a Series B round led by Bain Capital, with backing from Sattva Group. The company will use the funds to scale its tech and footprint while also launching a $100 Mn pan-India coliving platform with its investors.
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2. Healthtech startup FlexifyMe has secured ₹20 Cr from IvyCap Ventures and others to scale its online-offline presence and launch advanced posture and gait analysis labs. The AI-powered physiotherapy platform aims to tap into India’s $1.9 Bn physiotherapy services market by 2030.
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3. Quick commerce startup FirstClub has raised $23 Mn in a round co-led by Accel and RTP Global, with backing from Blume Founders Fund and others. The capital will power new dark stores, premium cafes, and expanded fulfilment formats for its member-first platform.
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4. Reveal Healthtech has raised $7.2 Mn in a Series A round led by Leo Capital to expand its AI-led clinical solutions and sales network. The startup offers engineering, clinical model, and strategy support to healthcare organisations.
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5. Mom-wear brand House of Zelena has raised ₹7 Cr ($800K) in a seed round co-led by Sprout Venture Partners and M Venture Partners, with backing from GSF and angels. With this, the company’s total funding now stands at $1.2 Mn.
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6. Solar startup QuantE Energy has raised $500K in a seed round led by Trillion Dollar Venture Partners, with participation from marquee angels like Raghunandan G and Amit Lakhotia. The funds will help expand clean, affordable energy access for housing societies.
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7. Automobile aftermarket platform AutoDukan has raised $1 Mn in a pre-Series A round led by Choice Group and select HNIs, with support from MetroMax Group and Ankit Sajnani. The startup will use the funds to scale operations and boost its AI-driven demand prediction.
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8. Kaleidofin Capital Private Limited has raised $3 Mn in debt from a Netherlands-based investor with a three-year tenure, extendable by another three. The funds will be deployed to support informal sector enterprises, particularly in agriculture and dairy.
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