This Hyperlocal Indian Delivery Start-up Has Raised $45 Million In Latest Funding Round

The funding for Dunzo comes at a time when the company is battling deep discounting from food delivery start-ups and the entry of e-commerce giant Amazon into the hyperlocal space.

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Google-backed Indian start-up Dunzo has raised $45 million in its latest round of funding, the company said on Friday. The latest investment comes from Lightbox Ventures, 3L Capital, STIC Investment, STIC Ventures and Google, and takes the total funding raised by Dunzo to $81 million.

Dunzo co-founder and chief executive officer Kabeer Biswas

“We are on course to building the largest commerce platform in the country,” Dunzo’s chief executive officer Kabeer Biswas said in a statement.

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Dunzo was Google’s first direct investment in a homegrown Indian start-up when the tech giant led a $12 million funding round in 2017. It was part of Alphabet’s Google taking its ‘Next Billion Users’ initiative forward, targeted at consumers in emerging markets.

Since then, the company has grown manifold, now operating in nine Indian cities, clocking over 2 million deliveries every month. “This round of investment stems from Dunzo’s 40x growth in the last 18 months,” Dunzo said in Friday’s statement.

What Began On WhatsApp

In 2015, the Bengaluru-based start-up was a WhatsApp-based service where one could put in a request on a group. It was a freelancing effort that eventually took the form of a mobile application.

The company now partners with local shops to give users an option to pick and choose from menus, making the experience smoother. In the next 18 months, Dunzo plans to expand to 25 cities in India.

“It is our belief that the team at Dunzo has tapped into the backbone of the Indian economy - local offline merchants,” said 3L Capital’s co-founder and managing partner Dave Leyrer. “Their approach to growth has been uniquely sustainable and we’re eager to see how they change local commerce dynamics in India.” 

Competing Against Deep Discounting

The latest investment comes at a time when food delivery start-ups such as Swiggy and Zomato are driving the competition with heavy discounts while e-commerce giant Amazon has also entered the space with the recent launch of Amazon Fresh, a two-hour grocery delivery service currently available for select locations.

What helps Dunzo’s case is the diverse set of services it offers.

Even though food and grocery form a part of its offering, the company’s original idea of picking up something from one place and delivering it to another has stayed. The fee is dependent upon the distance between the two places. It also offers services such as picking up laundry, among others.

Debroop Roy

Written By

Entrepreneur Staff

Covering the start-up ecosystem in and around Bangalore for Entrepreneur. Formerly an energy reporter at Reuters. A film, cricket buff who also writes fiction on weekends.