Pressured to turn profitable, Zomato is closing shop in 23 countries including the US, UK, Sri Lanka, Ireland, Chile and Canada. Co-founder and CEO Deepinder Goyal said the food ordering and delivery company will cease operations in countries where it is not a market leader. It will continue operations from its headquarters in India.

According to Live Mint, the US has been the most expensive venture for Zomato. It spent $60 million (of the total $225 million raised until now) to acquire Urbanspoon and enter the market to take on Yelp in January 2015. It then invested $50 million more to overtake Yelp within 12 months. This investment has eclipsed its operations in India and United Arab Emirates, where it is doing well.

In the last financial year, Zomato recorded a loss of Rs 492.3 crore, which is a steep 262% rise from the previous year—it recorded a loss of Rs 126 crore in FY15. At the same time, its revenues have doubled toRs 184.97 crore as against the Rs 96.7 crore from the previous year.

It is reported by Business Standard that Zomato loses an average of Rs 1.5 lakh a month; Rs 2 on every food delivery. Goyal said, “We make a negative Rs 2 despite having outsourced delivery. Our logistics partners are not able to make the unit economics work well. Restaurants are best equipped to deliver locally.”Restaurants handle deliveries 80% of the time while Zomato only does 20% of deliveries.

Zomato has 70,000 restaurants on its online platform. Earlier this year, the company issued an investment call for $200 million, but has since dropped the idea.

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