Serendipity Infolabs Pvt Ltd, that runs the online taxi booking site Taxiforsure.com, has raised an undisclosed amount in seed round of VC funding from Accel Partners, Helion Venture Partners and Blume Ventures. Anand Daniel of Accel and Ritesh Banglani of Helion have joined the board of the TaxiForSure.
Banglani said, "Our previous investments in Makemytrip and RedBus have shown us the tremendous potential of the online travel industry. We are backing TaxiForSure because they are tackling the next frontier in online travel by organizing a highly fragmented industry."
The company will use the funds to for strengthening its operations, setting up a call centre and talent acquisition.
The company was founded by Raghunandan G and Aprameya Radhakrishna, both engineering graduates from NITK Surathkal who went on to grab their management degree from IIM Ahmedabad. Before co-founding TaxiForSure in June 2011, Radhakrishna worked as the head of business development for PDS at Jones Lang LaSalle, India. He has also worked at Infosys. Raghunandan earlier worked with Feedback Ventures as a consultant.
TaxiForSure acts as an aggregator of car rentals and taxis in India and its offerings include local point to point taxis, airport transfer taxis, local packages and outstation packages. Besides regular taxis, it also provides booking for luxury cars like Rolls Royce Phantom, Hummer, Limousines, Jaguar, Audi A6, BMW 7 Series and Mercedes S class, among others.
As of now, the company only offers bookings in Bangalore, however expansion into other cities is on the cards and this is evident from the fact that the website also shows cities like Chennai, Mumbai, Delhi, Pune, Hyderabad and Kolkata (although bookings for these cities are not active at present). Users can book taxis online or via telephone.
When asked how they decided to enter the online car rental market, Radhakrishna said, "On researching the market we found that on the one hand consumers struggle to find taxis reliably, and on the other taxi operators and drivers struggle to get enough customers every day. We realized that technology can play an effective matchmaker in this market. Also, the two pain points of the customers are availability of the taxi and the time it takes to reach them; we are trying to solve this by targeting a 10 minute deadline."
Radhakrishna also talked about the online car rental space getting over-crowded very fast, "It is true that a lot of new players are entering the market, but they are all handling the demand and supply in their own way. While some are focused on corporate bookings, others are pure retail players and a few focus on both corporate and retail."
Online Taxi Booking: Funding, Market Opportunity & Consolidation:
After general e-commerce, the online car rental space has been hotting up with several startups entering the segment with funding from both angel investors and VCs. Early last month, Savaari Car Rentals Pvt Ltd raised () $1 million in a series A funding from Inventus Capital Partners; YourCabs.com raised angel funding from Sprism Investment Pvt Ltd and others and Taxiguide raised Rs 25 lakh in angel funding from Anand R P, investment director at Squadron Capital in his personal capacity (the company is also looking to raise $2M In Series A round).
Olacabs.com also raised series A funding from Tiger Global Management.
The taxi booking service addresses the pain point of urban commuters who face a dearth of modern and safe public transport system in most big cities. The entry of such firms have, in effect, led to pooling together of standalone unorganised cab services providers under a network and thereby building a marketplace for cabs. Majority of these start-ups are aggregators and besides competing with each other also face the older national players such as Meru or Easycabs.
The business proposition of the taxi booking start-ups, ironically, hinges on the 'reliability' factor as some of the older players have struggled to meet demand with cancelled bookings and non confirmations. But the new players face a challenge in terms of branding as the incumbents have a much better brand recall. The winners would be decided on who strikes the right partnership at the ground level and sensitising those partners on CRM besides the technology to manage inventory efficiently.
With a slew of players trying to make a mark, there is already some consolidation in the business. Last week, Carzonrent India Pvt Ltd, one of India's largest car rental companies, acquired QCABS, an online car rental services startup, for an undisclosed amount.