Private bus aggregation startup Shuttl is learnt to have closed a fresh $25-million, or Rs 160 crore, funding round as they look to replicate the success of taxi aggregators like Ola and Uber. Silicon Valley venture fund Lightspeed Venture Partners, Sequoia Capital, which is an existing investor, and Times Internet, part of the group that publishes this paper, have participated in the fund-raise, sources close to the matter told TOI.
Around 16 ventures have come up in the bus aggregation space over the past few months catering largely to office goers in cities like Bangalore, Delhi NCR and Mumbai.
Earlier this year, Shuttl had raised $3 million from Sequoia and angel investors. When contacted, Shuttl’s co-founder Amit Singh did not respond to telephone calls and emails sent by TOI. An email query sent to Lightspeed, Sequoia and Times Internet remained unanswered till the time of going to press.
Seeing a massive business potential, risk investors have been very closely watching the bus aggregation service. In India, about 70 lakh people commute daily using public vehicles and the industry is estimated to be about Rs 60,000 crore, of which online aggregation is at a minuscule size. According to startup data collector Traxcn, the sector has received a total funding of $3.75 million with ventures like Cityflo, Zipgo and Limo, formerly rBus, raising angel rounds. In fact, the country’s largest cab haling app Ola, which also runs its shuttle service, is planning to invest about Rs 150-200 crore in this space and has already launched in Gurgaon.
Shuttl at present is registering 10,000-15,000 bookings per day with more than 450 buses on its platform. The ticket size ranges from Rs 20-70 for the Gurgaon-based online bus aggregator. With fresh funds, it plans to enter major metro cities like Mumbai and Bangalore while it would also venture out into select non-metro cities. Shuttl has 150 employees on its roll now and is looking to hire more people to strengthen its operations nationwide and boost its tech platform. The new hiring will be across categories such as tech, operations, marketing, people aware of the company’s plans said.
Shuttl, Cityflo, ZipGo, Commute, Limo. Mojo and Trevo, among a bunch of others companies, are targeting the huge population of office-going commuters. Shuttl currently operates in circles such as Gurgaon. Noida and Delhi while Limo and Cityflo operate in Mumbai. Shuttl’s large fund-raise would help it gain a leg up over other competitors.
Globally, China’s largest taxi aggregator – Didi Kuaidi – launched a shuttle service only in July while Uber has been experimenting with a bus-style “Smart Routes” in San Francisco.
Experts say it would be interesting to see how these companies compete with state sector-run bus services, which are priced far lower, besides facing regulatory issues, especially in cities like Bangalore. Some investors are of the view that the bus aggregation space is huge and with Uber not having done this globally, an Indian player has the chance of owning this market fully.
News: Times of India
