Bike taxi operator Rapido widens FY19 losses on high cash burn from rapid scaling
Urban mobility startup Rapido’s cash burn during the financial year 2018-2019 showed how aggressively the company has scaled over a period of a year.
Roppen Transportation, the two-wheeler taxi service’s Hyderabad-registered holding company, widened its losses to Rs 53.29 crore, or a loss of Rs 53,141 a share in FY19, from Rs 10.35 crore, or Rs 10,326 a share a year earlier, it latest regulatory filings showed. Revenue grew 13fold to Rs 10.65 crore.
The startup’s expenses vaulted to Rs 63.93 crore from Rs 11.15 crore year-on-year. The ‘other expenses’ field was the category leader in terms of dragging losses further down.
Other expenses is labelled for costs associated with utilities, insurance, bike rider expenses, marketing, rent, technology, legal and recruitment charges.
Employee benefits expenses also notably increased by 218% to Rs. 11.59 crore. This coupled with an upshot in the recruitment charges listed under the other expenses category indicates an increase in headcount at the company.
Founded in 2015 by Rishikesh SR, Pavan Guntupalli and Aravind Sanka, Rapido offers mobile app based transportation services on bikes or two wheeler. The app connects customers who intend to book for a two wheeler ride with third party drivers who are vehicle operators or bike riders.
In August this year, Rapido acqui-hired Mumbai-based data analytics firm Vahanalytics in a cash-and-stock deal. The entire technology team of Vahanalytics was moved to Rapido to set up the data science department.
In the same month, Rapido raised $54.55 million in a round of funding led by Bengaluru-based public markets-focused private equity firm WestBridge Capital Partners. As per TechCircle estimates at the time, the company raised the sum at a valuation of $140-$150 million.
The last known valuation was around $56-$58 million in a $11.19 million fundraise in April from a clutch of new and existing investors.
Apart from the mileage that the company has received in the recent past in form of fundraises to fuel the manner of cash burn that it has engaged in, it has been in the news for other reasons.
The Madras High Court had banned Roppen Transportation Services from operating its bike taxi service Rapido in Tamil Nadu, in violation of Section 66 of the Motor Vehicles Act that prohibits anyone from using two-wheelers as transportation vehicles.