Dunzo raises $16 mn in first tranche of growth round from Google, Lightstone

Dunzo raises $16 mn in first tranche of growth round from Google, Lightstone
Photo Credit: VCCircle
1 Sep, 2020

Bengaluru-based Dunzo Digital, which runs an eponymous hyperlocal logistics platform, has raised about $16 million (Rs 117.33 crore) from returning investors Google and Lightstone in a growth funding round.

The companies each invested about $8 million (Rs 58.66 crore) in the startup, according to regulatory filings.

The latest capital infusion marks the first tranche of the $27.9 million (Rs 203.5 crore at current exchange rates) the company looks to raise in the Series E funding round. Lightbox Ventures, 3 L Capital, Pivot Ventures family, Bhoruka Finance Corporation of India, Moving Capital and its founder Kabeer Biswas are expected to invest in the round, the filings showed.

The development was first reported by online news portal Entrackr.

In February, the company announced raising an $11 million debt round from returning investor Alteria Capital. 

Dunzo’s last equity fundraise was in October 2019, when the company received $45 million in a Series D funding round, led by venture capital firm Lightbox Ventures. South Korean company STIC Ventures, US firm 3L Capital and returning investor Google also participated in the round.

According to VCCEdge, the current round takes the company’s overall fundraising to $115.23 million.

Founded in 2015 by Biswas, Ankur Agarwal, Dalvir Suri and Mukund Jha, Dunzo delivers grocery from shops and food from restaurants, and provides instant local courier services.

It has operations in Bengaluru, Mumbai, Delhi, Gurugram, Chennai, Hyderabad, Jaipur and Pune.

Dunzo has raised fresh capital at a time when competition in the hyperlocal space is heating up.

In July, Walmart-owned ecommerce major Flipkart launched a hyperlocal delivery app Flipkart Quick in Bengaluru. The service, which claims to deliver products within 90 minutes, has a minimum fee of Rs 29 and operates between 6 am and 12 am. It offers over 2,000 products in categories such as grocery, fresh produce, dairy, meat, mobiles, electronics accessories, stationery items and home accessories.

Earlier this month, Naspers-backed food delivery firm Swiggy rolled out Instamart, a new offering in its grocery business, to make last mile delivery faster and sell a wider assortment of products. Instamart, which operates between 7 am and 12 am, claims to deliver products within 45 minutes of order placement. Swiggy already operates in the last mile grocery delivery segment with Swiggy Stores, where it sells essentials such as fruits and vegetables, meat, pet care and wellness products by aggregating from existing offline stores.

Amazon, BigBasket and Grofers are also expanding their grocery delivery operations after facing some initial hiccups during the Covid-19 lockdown.