Dunzo Digital Private Ltd., a start-up delivery platform operated by Google and operating in eight Indian cities, aims to double the amount it has so far raised to expand its reach nationwide and become a $ 1 billion revenue business in the next two years.
The app, which connects cheap shippers with thousands of individual retailers, has attracted Indians with their fast delivery of items from food to parcels to congested cities. The Bengali company has so far raised about $ 140 million so far and aims to attract investors about $ 150 million by 2021.
“The expansion only starts next year in full, so we will raise money this year, but it will only be used next year,” said Kabeer Biswas, Dunzo’s chief executive, 36, in a statement. The company could move to two other cities by 2021, and build in 20 locations by 2023, he said. It has also started offering 15-minute delivery of a list of 2,000 most wanted items.
Dunzo founded in 2014 and started as a WhatsApp service, before becoming an app where customers typically pay around $ 6 per order.
It is entering the growing and accessible Internet use in India, where the advent of technology and consumers is thriving as the number of smartphone users is approaching 1 billion. E-commerce has become the fastest growing channel for the fastest consumer products in recent years, and now accounts for 5% of all such sales, according to Jefferies.
Dunzo and other food delivery services also saw the Covid-19 pilot race as the second wave of disease plaguing India. Competing firms riding that boom include Swiggy’s food delivery program, which said on Monday that it costs $ 800 million.
The growing suspension of state-level restrictions is “a development that should not be eaten lightly” but web-based marketing could gain “momentum,” Jefferies analysts, including Vivek Maheshwari, said in a report on Tuesday.
Biswas said Dunzo doubled annual sales by 2020 and expects the same growth rate this year. Dunzo ‘intense performance in Bangaluru is now illegal, he said.
However, the company is heating up to $ 2.5 million a month, although Biswas expects Dunzo to be profitable in 24 to 30 months. It also looks like it will expand to other markets in Asia by 2023, he said.
“You make 20 cents per order – the only way to get this business done on a scale,” he said. However, “it is important to be extra disciplined in your local growth, because you could suddenly start losing money everywhere.”