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Happy Monday! Zepto founders are raising funds through structured debt ahead of the company’s IPO. This and more in today’s ETtech Morning Dispatch.

Also in the letter:
■ App Store’s India study
■ Zomato CEO on Reddit rumours
■ Cars24 layoffs
Zepto founders tap Edelweiss, others for Rs 1,500 crore structured debt to boost Indian ownership
Aadit Palicha and Kaivalya Vohra, founders, Zepto

Zepto founders Aadit Palicha and Kaivalya Vohra are raising about Rs 1,500 crore through structured debt to boost Indian ownership ahead of the company’s planned IPO, people familiar with the matter told us.

• The lenders: Edelweiss Alternative Asset is anchoring the deal alongside domestic family offices and smaller credit funds.
• The terms: The loan carries a minimum interest rate of 16%, with an equity-linked upside pushing total returns closer to 18%.
• The security: The debt is backed by a pledge of promoter equity, rare among Indian new-age tech startups still burning cash.
• The timeline: The transaction is expected to close by July, and the three-year term will end in 2028.

Between the lines: The structured debt will allow Zepto’s founders to acquire shares from existing foreign investors, raising their holding to around 20% from 18%. Overall domestic shareholding could cross 30% post-deal, sources said.

• India’s FDI rules allow 100% foreign investment in marketplace models but prohibit FDI in inventory-led ecommerce.
• Only Indian Owned and Controlled Companies (IOCCs) can legally operate inventory-led models.
• To qualify as an IOCC, a company must have more than 50% Indian ownership and control.
• On April 19, Zomato’s parent, Eternal, capped foreign shareholding at 49.5% to ensure Indian majority control.
• This move enables Blinkit to stock and sell inventory directly, improving margins and expanding into private labels.

Also Read: Byju's and the debt trap haunting Indian tech startups

Catch up quick: Zepto secured NCLT approval on January 9 to merge its Singapore-based parent, Kiranakart, with its Indian entity, Kiranakart Technologies Pvt Ltd.

The company has since renamed itself Zepto Private Limited to align with its consumer brand ahead of the public listing.

What’s next: Zepto is separately closing a $250-million secondary sale, led by Motilal Oswal Financial Services, to clean up its cap table further and enhance Indian ownership.
Rapido likely to run food delivery pilot in Bengaluru soon
(L-R), Rishikesh SR, Aravind Sanka, Pavan Guntupalli, cofounders, Rapido

Bike taxi platform Rapido may roll out the pilot programme for its food delivery service in Bengaluru in the coming weeks, sources told us.

What’s brewing: Rapido is targeting major restaurant chains and is in discussions with franchise operators of McDonald's, KFC, and Pizza Hut, along with other high-volume quick-service and cloud kitchen chains. ET first reported on March 12 the company's plans to enter the food delivery segment.

A person familiar with the matter said the initial focus will be shorter-distance deliveries from large restaurant chains with dense outlet networks in top cities. While large chains account for a significant share of orders, smaller outlets offer consumers greater choice, they added.

New roots: The WestBridge Capital-backed firm, Rapido is seeking new growth drivers, focusing on food delivery and insurance distribution. It built momentum in the ride-hailing market by entering late and disrupting incumbents, but diversification has become crucial as growth slows.

Rapido crossed $1 billion in gross merchandise value last fiscal. ET reported on April 1 that Rapido had captured over 20% market share (and growing) in the four-wheeler ride-hailing segment, compared to Uber’s 50% and Ola’s 30%.

Wrong timing: Rapido’s foray into food delivery comes as the segment faces muted growth, even though it remains the biggest revenue source for market leaders Zomato and Swiggy. In an interview with ET in March, Zomato parent Eternal’s CEO Deepinder Goyal highlighted systemic issues with the food delivery segment, indicating that the company would launch fresh initiatives to address them.
Apple App Store in India facilitated $5.3 billion in developer billings, sales in 2024

Apple’s App Store ecosystem generated nearly Rs 44,447 crore ($5.31 billion) in developer billings and sales in India in 2024, according to a study by the tech giant, sourced by ET.

Driving the news: This marks the first time Apple has publicly shared these figures. Key findings include:

• More than 94% of the Rs 44,447 crore accrued directly to developers and businesses of all sizes without any commission to Apple.
• In 2024, App Store developers recorded Rs 38,906 crores ($4.65 billion) in total billings from the sale of physical goods and services, Rs 3,014 crores ($352.9 million) from in-app advertising, and Rs 2,527 crores ($302 million) from digital goods and services.
• Nearly 80% of India-based developers’ earnings came from users outside India.

Tell me more: According to the study, the global earnings of India-based developers have tripled over the past five years. The study also noted that apps from Indian developers consistently featured among the most downloaded in App Store storefronts worldwide.

Also Read: Apple aims to source all US iPhones from India in shift away from China: FT report
Other Top Stories By Our Reporters
(L-R), Vikram Chopra, Mehul Agrawal, Ruchit Agarwal and Gajendra Jangid, cofounders, Cars24

Cars24 lays off 200 employees, to tighten hiring plans: Used car sales platform Cars24 has laid off around 200 employees across various functions, including product and technology, as it pulls back on certain projects, cofounder and CEO Vikram Chopra said in an internal note to staff.

Internal whistleblower alleges deep crisis at Zomato; CEO Deepinder Goyal dismisses it as ‘utter nonsense’: Zomato chief executive Deepinder Goyal on Saturday firmly denied claims that the food delivery platform is losing market share or pressuring employees to exclusively order through it after a post against the company went viral on Reddit.

India grappling with a dearth of agentic AI experts: India is facing a severe shortage of agentic AI professionals as companies move beyond basic chatbots to develop intelligent agents capable of solving complex business problems and support decision-making.
Global Picks We Are Reading
■ The Meta trial shows the dangers of selling out ( Wired)

■ Brands target AI chatbots as users switch from Google search ( FT)

■ Why India fell behind China in tech innovation ( Rest of World)