Intra-city bus services aggregator Shuttl is exploring mergers with potential suitors as the Gurugram based startup finds itself beyond the point of recovery following unprecedented business losses over the last 15 months.
The development was announced by one of its co-founders, Amit Singh, on microblogging platform Twitter on Monday.
“We've taken a tough but practical call. A call that best takes care of the interest of our team, customers, partners, shareholders. The call is to join forces with another entity. An entity that's less impacted by Covid & can better tide over these challenging times,” Singh wrote on Twitter.
The startup is in “serious discussions” with Indian and international companies for a potential merger, he wrote.
Shuttl was clocking 100,000 daily rides with positive unit economics and was in the process of expanding operations to global markets when a series of lockdowns, on account of the Covid-19 pandemic, hit the country in March 2020, the Twitter thread said.
He said the platform continues to operate at a small scale with a smaller team and has offered affected employees a severance package of 3-6 months depending on their tenure.
Queries to Singh did not elicit responses at the time of publishing this report.
The development was first reported by digital publication Entrackr.
According to a media report from March 2020, the co-founders had taken 50% salary cut, enforced pay cuts for the workforce and handed out pink slips to many employees.
Operated by Super Highway Labs, Shuttl’s last known fundraising was in February 2020 when it raised $3 million from Tokyo headquartered industrial conglomerate Sojitz Corporation. The infusion followed a $8.1 million round that the company raised in January from an Indian entity of US-based quantitative trading firm Susquehanna International Group.
Its largest funding came in October 2019 when the company raised $18 million from Toyota Motor Corporation and Mirai Creation Fund.
Overall, the company has raised $60 million from investors including Sequoia Capital India, Times Internet, Dentsu Ventures, Amazon, Lightspeed India Partners, Sumitomo Mitsui Corporation and Trifecta Capital, according to data available with VCCEdge.
Shuttl was founded in 2015 by IIT Delhi and IIT Kanpur alumnus Singh and Deepanshu Malviya. It offered on-demand bus services to daily commuters in Delhi, Mumbai, Pune, Chennai, Kolkata, Gurugram, Noida, Faridabad. It operated 1,000 buses along 150 routes as of February last year.
In 2016, two operators LIMO and Essel-backed Zipgo shut shop after being unable to raise additional capital, lack of customer stickiness and regulatory issues.