Vehicle Sharing Marketplace Drivezy in Talks to Raise $100M in Equity and Another $400M in Asset Financing
Aims to expand its vehicle sharing marketplace across more emerging markets
Bangalore-based vehicle sharing marketplace, Drivezy, announced today is looking to close a fresh round $100 million in equity funding, and another $400 million in asset financing in its next round of funding. The company will use the capital to expand its marketplace into new markets and integrate advanced services. The company announced $20 million Series B funding in November 2018 and has consistently launched services in a new city every month. Drivezy is aggressively scaling its presence across India and consolidating its foothold in the growing two-wheeler and car sharing business. The company caters to over 1.5 million users in 10 cities and operates with more than 8,000 vehicles on its platform.
“The sharing economy in India is thriving and has picked up the real pace in the past five years, especially within the mobility sector. With less than 8% of Indian citizens owning a car, the rapidly growing car and bike sharing industry could provide convenient and sustainable mobility to millions of urban Indian residents. This fresh investment will allow us to cement our foothold as the market leader in a growing Indian vehicle sharing market. We aim to go deeper into existing markets and are evaluating new international markets in South East Asia and other regions. Our vehicle sharing model is a simple and powerful way of how people are shunning the notion of conventional ownership and adopting the renting trend.” said CEO, Ashwarya Singh.
Drivezy recently raised a total of $20M in a Series B equity financing and secured $100M in an asset financing deal under which the company plans to induct over 50,000 vehicles. The funds will be deployed over a period of three years, through a Special Purpose Vehicle (SPV); Harbourfront Capital, which will focus on investment in global shared assets. A Special Purpose Vehicle is often used by companies to securitize assets. Its operations are limited to the acquisition and financing of assets as a method of isolating risk. The establishment of the financing mechanism by Anypay Inc. for investments in shared assets is ‘the first of its kind’ in the growing Indian sharing economy. Drivezy has worked consistently with AnyPay to deploy innovative channels for financing and enlisting assets in its marketplace. The round was led by existing investor Das Capital. Other investors who participated in the round include Yamaha Motor Co. Ltd., Axan Partners and IT-Farm. With the recently concluded funding round, the company has accrued equity investments of $31 million in total.
Expansion Plans: Drivezy currently operates in ten other cities across India including Delhi NCR, Hyderabad, Kochi, Mumbai, Pune, Mangalore, Mysore, Nagpur, Hubli and Manipal. The company aims to expand to 21 cities including Amritsar, Chennai, Chandigarh, Jaipur and Kolkata by March 2020. The company also aims to launch its services in international markets across Thailand, Singapore, Vietnam, Indonesia, United States of America by the end of 2019. Drivezy’s GMV has grown by 10.04% on a month-on-month basis and over the last 6 months, the GMV has increased from $2.8 Mn to $3.5 Mn. Drivezy’s MAU has tripled from January 2019 till present.
Vehicle sharing platform: Founded in 2015, the company offers car, motorcycle and scooter sharing services across 10 cities in India. Drivezy competes with players like Zoomcar, Revv and Bounce in the vehicle sharing segment. However, it is the only service to offer both cars and two-wheelers under a single platform. But the definitive edge that the company has over its competitors is its expansive vehicle sharing platform which allows people to enlist their idle vehicles and rent them to customers through Drivezy’s mobile app or website. An average car is stationary 96% of the time, a finding that is fairly consistent around the world, including India. Cars are typically parked at home 80% of the time, parked elsewhere 16% of the time, and on the move just 4% of the time. Since the inception of the marketplace, Drivezy has partnered with more than 5,000 owners.
Bike and scooter rental: Drivezy is aggressively scaling its bike and scooter rental divisions. In 2018, Drivezy enlisted more than 10,000 scooters, becoming the largest operator in the Indian vehicle sharing space. The company has listed an additional 7,500 new vehicles which will be added to the platform by March 2019. The company aims to utilize the additional fleet to include one-way, intra-city sharing services for motorcycles and scooters in the city. Drivezy had recently commenced Smart Commute, a last-mile self-drive rental service for Hyderabad Metro Rail passengers. The rationale behind ‘last mile connectivity’ using bikes and scooters is to simplify travel for metro commuters who face difficulties in reaching their final destination from metro stations. Under Smart Commute rentals, customers pay by the kilometre and can rent a two-wheeler for as prices as low as Rs. 2 per Km.
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