Mumbai-based e-commerce logistics startup Wow Express has raised Rs 30 crore (around $4.5 million) in its Series A funding round from undisclosed existing investors as well as the Tamarind Family Trust, a top company executive told TechCircle.
The startup will use the funds for geographical expansion, to strengthen its technology, and to hire executives for the finance and tech verticals, Sandeep Padoshi, co-founder of the venture, said in a telephonic conversation.
The current round also includes compulsorily convertible debentures issued around 7-8 months ago and comprise 30-40% of the total funding raised, Padoshi added.
“The immediate goal is to expand our reach to around 100 cities. We are already present in close to 50. Besides, we are also looking to bring in new technologies like artificial intelligence and machine learning into aspects of our logistics-tech component that include auto address corrections and predictive delivery analysis,” Padoshi told TechCircle.
Tamarind Family Private Trust is the investment arm of the Mansukhani Family, which is a co-promoter of consumer electronics maker Onida.
In May 2016, Wow Express had raised Rs 15 crore (around $2.2 million) in a pre-Series A round led by a group of unnamed US-based investors. The Tamarind Family Private Trust had also participated in that round.
In July 2015, the Tamarind Family Private Trust had made a seed investment of $500,000 (Rs 3.17 crore) in the logistics company.
Operated by JMS Logistics and Express Pvt. Ltd, Wow Express was founded in January 2015 by Padoshi, Jayesh Kamat and Mazhar Faruqi. It offers tech-enabled end-to-end logistics solutions that include first and last mile delivery, warehousing, and reverse logistics, which is the buying and selling of used goods, for the e-commerce sector.
The startup, which currently handles more than 20,000 deliveries a day, hopes to bring this number to 50,000-60,000 in the near future. Around six months ago, the three-year-old venture also diversified its logistics offerings to the diagnostics and healthcare space, which involved collecting and delivering blood samples, bodily fluids and medicines. It claims to handle a collective 60,000 samples per day already. This operates as a separate arm within the organisation.
“While the e-commerce logistics sector is catered to and served by quite a lot of players, we found an equally compelling opportunity in the diagnostics and healthcare space,” Padoshi said, adding that the company is also evaluating cross-border deliveries for the next phase of its growth.
All three co-founders have earlier worked for companies such as DHL, Reader’s Digest, UPS, TNT and Singapore Post.
“While we have already broken even on a month-on-month basis, geographical expansion entails gestation and new cash burn. Hence, we expect to break even at a company-wide level in 2019-20,” Padoshi added.
Recent deals in the logistics sector
The logistics tech sector has seen considerable investor activity in the past few months.
Early this month, logistics management startup Locus raised $4 million (Rs 26.8 crore) in a pre-Series B round of funding from new and existing investors.
Around the same time, all-women last-mile logistics services firm HeyDee, raised pre-seed funding of $500,000 (Rs 3.3 crore) from early-stage investor Metaform Ventures LLC.
In May, e-commerce logistics company Delhivery planned to tap the public markets and had approached investment banks for the mandate to run the share sale.
In one of the big ticket deals in the space, in January this year, Gurugram-based tech-enabled logistics services provider Rivigo raised Rs 322.5 crore ($50 million) in a Series D round, which saw its valuation catapult to near-unicorn levels.