American food apps are aiming for a bigger slice of the pie

The largest food delivery apps targeting Chinese-speaking customers are positioning themselves to capture a broader share of the US and global markets as Asia’s population grows.

Several years ago, food delivery apps such as Fantuan, Chowbus and HungryPanda were created to help customers who are more comfortable ordering in Chinese. Today the apps have millions of users.

“With the US market offering tremendous potential, our focus remains on expanding our reach and penetration even further,” said Crystal Li, PR manager at Fantuan.

“Fantuan has more than 3.6 million users in four countries: the US, Canada, Australia and the UK… including immigrants, international students, local Asians (e.g. American-born Chinese or Canadian-born Chinese), tourists and anyone who loves authentic Asian cuisine.”

There are about 120,000 Asian restaurants in the United States, and nearly four in 10 offer Chinese food, the Pew Research Center found.

About 45 percent of restaurants are in five states with significant Asian populations: California, New Jersey, New York, Texas and Washington, Pew found.

Asian restaurants were hit hard during the COVID-19 pandemic, amid anti-Asian sentiment in the US. Asian restaurants lost $7.4 billion in revenue in 2020, according to a 2023 study by researchers at Boston College, the University of Michigan and Microsoft Research.

As businesses and restaurants in the US and across North America try to win back customers after the pandemic, many of the food delivery apps are increasingly being used by restaurants in cities like Houston, Minneapolis and San Jose, The New York Times reported .

“They (the customers) seek comfort in the flavors of their hometown even when they are far from home,” Li told China Daily. “Unlike mainstream apps, our platform is fine-tuned to their preferences and offers authentic Asian selections not found in those apps, as well as Chinese language support.”

Amid a venture-backed push for growth, Vancouver-based Fantuan closed a $40 million Series C funding round in December. It was done specifically to enter the Asian food delivery market and provide services to its global customers.

Meanwhile, UK-based Hungry-Panda has raised $220 million in capital since 2019.

Huge size

There are approximately 40 million Asians in the countries where Fantuan operates, with a market size of more than $36 billion.

With an estimated 2.38 million Chinese immigrants in the U.S., the population has grown rapidly from 1.8 million in 2010, according to data from the U.S. Census Bureau and American Community Surveys.

“The Asian population is certainly increasing,” Richard D.Alba, an American sociologist, told China Daily. He is also a professor emeritus at the City University of New York and in the department of sociology at the State University of New York, Albany.

Moreover, the largest number of foreign students studying at US universities – 300,000 – came from China in 2022, according to US State Department figures.

To further serve this demographic, the apps are taking significant steps to position themselves to tap not only the Asian food market, but also generic American restaurants in the future.

In January, Fantuan acquired Chowbus’ delivery business, a move that will “solidify Fantuan’s leading position in the US-Asia delivery market by strengthening our market share,” Li said.

Fantuan also offers online grocery delivery and shopping services in a few major cities, the company said.

Meanwhile, Chowbus, which offers delivery services in more than 20 cities in the country, has ventured into restaurant management software and has 1,000 restaurants as customers. As of 2022, it has raised $40 million.

Linxin Wen, CEO and co-founder of Chowbus, said in a statement that the company’s main goal was to help North American restaurants, “especially those new to the country, who generally need help with technology and marketing”.

Li said another key reason for the Chowbus acquisition was to “collaborate with even more mom-and-pop restaurants and businesses and provide a more comprehensive back-of-house solution for merchants.”

It wants to be a kind of “overseas Meituan,” Li said.

Across the pond, HungryPanda is the largest overseas Asian food delivery platform; it works with 60,000 merchants and serves more than 3.5 million registered users worldwide.

HungryPanda operates in more than 80 cities in 10 countries, including Australia, France, Japan and Singapore, with room to grow.

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