Fantuan acquires Chowbus' food delivery business

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Vancouver, Canada-based Asian food delivery company Fantuan announced that it has acquired the delivery business line of Chowbus. Financial terms of the deal were not disclosed.

Chicago-based Chowbus also started as a delivery service in 2016, focused on providing mom-and-pop Asian restaurants a way to expand their customer base. Co-founders Suyu Zhang and Linxin Wen grew the company to more than 20 cities by 2020 and raised $40 million in venture capital funding, including a $33 million round in 2020.

Then in 2022, Chowbus will turn to providing restaurant management software and point-of-sale services, Fantuan co-founder Yaofei Feng told TechCrunch. A year later, it had more than 1,000 restaurant customers.

“We are in a similar industry, but each has a particular demographic coverage,” Feng said. “Now we cover more in Canada and they cover more in the central and eastern parts of the United States. We wanted to make better penetration and get more customers so we sat down and talked.

Fantuan, Chowbus, Food Delivery

Fantuan and Chaubas are coming together. (Image credit: Fantuan)

The acquisition marks a partnership between the two companies that will blend each of their strengths with local Asian restaurants: Fantuan's fast food delivery process with Chowbus' restaurant management software.

“With the rapid growth of the restaurant SaaS business line, we want to focus on and develop better products and services for merchants,” Linxin Wen, founder and CEO of Chowbus, said in a statement. “We are confident that our partnership with Fantuan will provide enhanced and expanded services for merchants across food delivery, restaurant SaaS systems, and beyond.”

Meanwhile, Fantuan was founded by Randy Wu in 2014 and operates in more than 60 cities in Canada, the United States, Australia, and the United Kingdom. Apart from restaurant delivery, the company also operates in fresh grocery delivery and dine-in service segments. In December 2023, Fantuan raised $40 million in Series C capital.

About 20 ChowBus employees will join Funtuan, Feng said, which will also manage ChowBus's fleet of independently contracted delivery drivers.

After consolidating Chowbus' delivery business, Fantuan plans to strengthen its Asia-focused food delivery services in US cities. The company already has about 80% market share in Canada, Feng said, compared to just 10% in the U.S. market. Both companies also want to help restaurants gain additional business and convenience through order automation and more revenue.

The food delivery industry is going through an interesting time. JOKR is implementing it, while Getir pulled out of some markets over the summer. More recently, Uber announced it would shut down Drizly after acquiring the alcohol e-commerce business three years ago, and Jumia said it would shut down its food delivery service due to “aggressive competitors with deep pockets.” Is doing, according to CEO Francis Dufay. Meanwhile, antitrust regulators in the European Union suspected similar cartels and raided two online food delivery companies in November. And Indian food delivery company Swiggy went on a shopping spree.