Exclusive: Sequoia, Lightspeed lead fresh investment in bus aggregator Shuttl

Bus aggregation platform Shuttl has raised fresh capital from existing investors as part of a larger funding round, two people privy to the development told TechCircle on the condition of anonymity.

Venture capital firms Sequoia Capital India and Lightspeed Venture Partners along with Times Internet, a subsidiary of media company Bennett, Coleman and Co Ltd (BCCL), have invested $7-8 million (Rs 48.3-55.2 crore at current exchange rates), said one of the two people cited above.

“The size of the current round may go up to $20 million. The $7-8 million tranche was led by Sequoia and Lightspeed,” said the second of the two people.

Email queries to Shuttl founders Deepanshu Malviya and Amit Singh, Sequoia, Lightspeed and Times Internet did not elicit a response at the time of publishing this report.

The first person cited above said that Shuttl’s valuation could stand anywhere between $150 million and $160 million when it completes the $20 million funding round. The startup’s last-known valuation, as per TechCircle’s estimates, was around $85-90 million (Rs 586.79-621.31 crore at current exchange rates).

In July last year, Shuttl, owned by Gurugram-based Super Highway Labs Pvt. Ltd, had raised $11 million (Rs 75.5 crore then) in a Series B funding round jointly led by Amazon Alexa Fund and Japan-based Dentsu Ventures. It could not be immediately ascertained whether the fresh infusion is a top-up on the Series B round.

The company’s last-known funding round took place in January this year when it raised $1.3 million (around Rs 9.2 crore then) in venture debt from Trifecta Capital.

Shuttl

Shuttl was founded in April 2015 by Singh, an alumnus of Indian Institute of Technology-Delhi, and IIT-Kanpur graduate Malviya. The platform provides shuttle services to office-going commuters besides separately catering to corporates. In addition, it also provides vehicles for rentals, according to information available on its platform.

Shuttl currently operates in Delhi, Gurugram, Hyderabad, Kolkata, Faridabad, Noida, Pune and is expanding rapidly to other cities, as per information available on its Google Play Store page.

In September last year, Shuttl inked a pact with Hyderabad-based Commut to absorb its customers and driver partners.

As part of its diversification, the company is also mulling a foray into food delivery. The company’s Ministry of Corporate Affairs filings revealed that it has tweaked its objects in the AoA (articles of association) to enable its entry into the hyperlocal food delivery space.

“To carry on the business of manufacturing, processing , packaging, storage, transportation, buying, selling, producing, importing, exporting, distributing, trading, supplying, marketing, managing and dealing in all kinds of foods and beverages …..” the object stated.

According to data compiled by VCCEdge, the financial and data research platform of Mosaic Digital, the company that owns TechCircle, Shuttl posted a three-fold rise in operational revenues for the financial year 2017-18 at Rs 44.74 crore, up from Rs 14.34 crore in the previous fiscal. The rise in operational revenues also led to a marginal reduction in net losses to Rs 51.22 crore, down from Rs 59.07 crore in 2016-17.

Other players

Shuttl is among the best-funded players in its segment. ZipGo is another well-funded player.

In August last year, Bengaluru-based ZipGo Technologies Pvt. Ltd, which operates ZipGo, announced that it was raising Rs 300 crore (around $43.7 million then) in a Series B round of funding from the Subhash Chandra-led Essel Group.

Two months later, ZipGo acquired Pune-based bus aggregator Supreme Trans Concepts in a cash-and-stock deal.

However, TechCircle reported last month that ZipGo was shutting down its Bengaluru and Mumbai operations amid a crisis at the Essel Group.

The sudden spike in funding activity in the segment from the middle of last year came after a prolonged lull, during which homegrown ride-hailing unicorn Ola decided to shut its bus aggregator services unit, Ola Shuttle, in February 2018 as part of efforts to ‘rebalance its portfolio’.