Zomato founder and CEO Deepinder Goyal has fact-checked a viral Reddit post alleging “internal chaos” at the company, dismissing the claims as “utter nonsense”. He clarified that Zomato is neither suffering losses nor coercing employees to place orders through its platform. The 42-year-old said that the company “vehemently” stands for “freedom of choice” and has not placed a blanket ban on ordering from competitors while at the office.

“All of this is utter nonsense,” he wrote while quoting the Reddit post. The IIT-Delhi alumnus added, “Neither are we losing market share, nor will we ever force our employees to order on Zomato. Freedom of choice is something we stand for vehemently.”

“It is embarrassing to even clarify this – but doing it since many people reached out to me with concern,” Goyal, who has a net worth of $1.4 billion, said. He also expressed gratitude to those who checked in, adding that he “appreciates it”. 

What does the Reddit post say?

The Reddit post by “Spiritual-Mode-5374” on the platform’s “StartUpIndia” community claims that things at “Zomato are lately off the rails”. It claimed, “In a recent internal huddle, leadership admitted that they are losing a good chunk of the market share to Zepto Cafe and Swiggy. The reaction? Panic and ridiculous new rules. One of them: employees must order from Zomato at least seven times a month, and yes, they’ll track it. Ordering from competitors is outright banned in the office.”

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The post that has over 1,200 upvotes further claimed that the company removed its CEO, Rakesh Ranjan, after he told everyone to “stay focussed” and “get back on track”. The company, however, denied his departure. 

“At Eternal Group, internal reshuffling of the leadership team is considered a standard practice as part of the company’s ongoing efforts to optimise organisational effectiveness,” the company said in an exchange filing.

“Toxicity is baked in. Office politics, micromanagement, and public degradation of employees for the bare minimum are becoming the norm. The only thing keeping the company profitable now is platform fees, unbelievably. Internally, no one seems to care about long-term sustainability, just numbers,” the Redditor claimed. 

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It also pointed out that the delivery partners are bearing the biggest brunt of the crisis as they are “underpaid and overworked”. “…Zomato pays significantly less and sometimes nearly half. As a result, many riders are quitting or switching platforms,” it further added. 

The Reddit post also underlined several frauds, including incidents of food parcels disappearing after being picked up, orders failing due to unavailability of delivery partners, and internal mismanagement, asking, “Who gets blamed? Everyone except the people responsible for fixing this broken model.”

It went on to say, “Restaurant partners are fed up too. They’re pushed into spending on ads just to remain visible, with no real help or insight into performance. Most of them are left in the dark, and even basic support is a nightmare. Everyone’s chasing targets.”

“Customers are frustrated. Riders are frustrated. Restaurant partners are frustrated. It’s a vicious cycle. Zomato might still look shiny from the outside, but inside, it’s falling apart,” the Redditor concluded, saying that frustration runs deep across the company’s ecosystem. 

Zomato’s Internal Chaos
byu/Spiritual-Mode-5374 inStartUpIndia

Social media reactions

One X user responded to Goyal’s post and said, “Sad to see that a founder of your stature, one who so many count as a beacon of light in the ecosystem, has to come and clarify, what can at best, be called internal reshuffling. Wishing you the best. Excited for the new innovations you have in store for us.”

“I mean, if it is false, prove it with numbers. You just posting that it isn’t true is going to make things worse, where people will start creating more false info,” another added. 

A third said, “You have increased the reach of ‘utter nonsense’ by posting the link.”

“I don’t think there is anything wrong with advising employees to place orders, in order to get a real feel of what is going on and to work on the flaws. It should be encouraged so that changes can be made immediately, and obviously, Zomato should compensate for the test orders,” commented a fourth. 

A fifth expressed, “We didn’t even know there was internal chaos like this brewing up. Now we know… thanks.”

One user responded to the Reddit post that Goyal quoted, and wrote, “First of all, it’s not a startup. Secondly, people who built Zomato and cared for it have cashed out after the IPO itself. Last I checked, Deepinder bhaiya now owns only 4 something per cent of Eternal Limited, which is now the parent company of Zomato. He may be advertised as the face of Zomato, but he’s quite frankly may have checked out mentally. Investors will now look for any or every opportunity to squeeze the lemon for that last ounce of juice! That’s the harsh reality of this business.”

“Zomato’s culture was never good to begin with,” added another. 

A third shared, “It’s not a business model. It’s a scam. They are unnecessarily sneaking in between the restaurant and the customer, thereby distorting the pricing of the entire industry. Most affected are those who do not want to use their services. They end up cross-subsiding for Zomato/Swiggy customers because businesses want to pretend that the delivery companies are surviving only on the delivery charges, which is false.”