Shuttl, the bus aggregator platform owned by Gurugram based mobility startup Super Highway Labs, has raised $18 million in a Series C round from Toyota Motor Corporation and Mirai Creation Fund. The latest infusion takes the total capital raised by the startup to nearly $60 million.
The round values the nearly five-year year old startup at over $200 million, by TechCircle’s estimates.
Japanese automotive major Toyota, which invested through an entity called Toyota Tsusho Corporation invested $6 million for a 3.01% stake. Mirai Creation Fund, investing from its second fund, invested $12 million for a 6.02% stake, regulatory filings showed. The Mirai funds are backed by Toyota, Sumitomo Mitsui Banking Corporation, and Tokyo headquartered Sparx Group.
The Series C comes about eight months after Shuttl raised $7 million in a Series B round from venture capital firms Sequoia Capital India and Lightspeed Venture Partners and Times Internet, the digital arm of media conglomerate Bennett Coleman & Co. According to prior regulatory filings, Times Internet invested $1 million, while Sequoia and Lightspeed invested $3 million each.
The capital raised in the Series C round will be used for expansion, potential acquisitions, working capital and general corporate purposes, according to the latest regulatory filing.
Founded in April 2015 by Amit Singh and Deepanshu Malviya, alumni of IIT Delhi and IIT Kanpur respectively, Shuttl offers on-demand bus services to daily commuters. It also offers vehicles on rentals. The platform claims to operate 1,000 buses along 150 routes in Delhi, Gurugram, Faridabad, Noida, Kolkata, Pune and Mumbai.
Incidentally, the startup’s latest investor Toyota was also reported to be in talks to invest a $250 million in online vehicle marketplace Droom.
India’s public transport market has a lot of space for players such as Shuttl to grow as there is a dearth of organised players in the segment. Besides, the availability of buses, which are one of the most preferred modes of commuting, is very low on per capita basis.
Apart from government-owned bus transport systems, privately owned bus service providers are mostly unorganised. However, despite the opportunity the segment offers its own challenges such as building scale, customer acquisition, public subsidies, among others. Besides, with major players such as Ola and Uber entering the segment is also a risk for emerging startups.
In 2016, Mumbai-based LIMO shut shop on overall funding issues while recently Essel Group-backed Zigpo Technologies closed operations in Bengaluru and Mumbai months after raising $43 million in a Series B funding.
Apart from Shuttl, other players in the bus aggregator space include Cityflo and EasyCommute. The space has also seen a fair bit investor interest. In June this year, Cityflo raised an undisclosed sum from venture capital firm India Quotient and founder Anupam Mittal.