‘You become a slave to logistics’: Startup founder reveals harsh reality of running cloud kitchens – ‘Never again!’

In a brutally honest LinkedIn post that has sparked conversation across India’s startup ecosystem, Zippee founder and CEO Madhav Kasturia shared his hard-earned lessons from over six years in the cloud kitchen space, warning entrepreneurs that the model is “harder than it looks” despite its apparent scalability.

Kasturia, who previously ran two Delhi-based cloud kitchen brands ‘Beijing Street’ and ‘The Jackpot’ from 2015 to 2021, described his experience as eye-opening and discouraging enough to vow never to return to the business.

“Everyone thinks cloud kitchens are a cheat code: food + delivery = profit. Cute theory,” he wrote.

One of the key challenges he outlined was the over-reliance on aggregator platforms such as Swiggy and Zomato, which he said “list your brand like detergent” and take 25–30% commission on every order eating heavily into already thin margins.

“You become a slave to logistics; soggy packaging, one-star reviews, Zomato payout cycles,” he added.

According to Kasturia, 25–30% of cloud kitchens in India shut down within a year, highlighting the volatility of the sector despite massive funding and hype.

Kasturia also criticized failed aggregator-led ventures such as Swiggy Daily and Zomato Every day, which attempted to tap into the subscription meal space.

“Customers didn’t want the same bland meals all week. People want flavor, options, and a human touch,” he said, stressing that many cloud kitchen ventures have “forgotten the ‘food’ in the food business.”

In a compelling comparison, Kasturia pointed to a humble chaiwala (tea seller) outside his former outlet who earns ₹3 lakh per month without spending on customer acquisition or discount coupons.

“Not romanticizing tapris here, but they get food better than most funded kitchens do,” he noted.

“Before you jump into the next delivery-only model, go spend a week in a tapri. You’ll learn more about margins, loyalty, and love for the product than any pitch deck can teach you.”