Logistics marketplace and aggregator of trucks LetsTransport has raised $12 million (864 crore) in Series B funding from Bertelsmann India and Chinese investment firm Fosun International.
The company plans to use the funds to expand its operations into more cities, mainly the smaller cities, where there are no organised players yet in the intra-city deliveries segment. The company at present serves seven cities —Bengaluru, Delhi, Chennai, Mumbai, Hyderabad, Vijayawada and Tiruchi. The immediate plan is to enter Kolkata, Surat and Ahmedabad.
Pushkar Singh, Founder, LetsTransport, said that the funds will also be used for product development and technological expansion, which will further help the company boost its revenues to about 100 crore in the fiscal 2019, almost double from 49 crore in the previous fiscal.
E-commerce boom - “Entry of e-commerce has really helped expand the logistics market and with the use of technology logistics and supply-chain is becoming very efficient that is helping us get more business. We are expecting 300 crore revenues in FY 20,” Singh told Business Line.
LetsTransport was founded by Singh, an IIT-Kharagpur alumnus, and his batchmates Sudarshan Ravi and Ankit Parasher in 2015. Singh, who was with the foods division of FMCG major ITC, saw the potential to digitise the processes involved in intra-city deliveries that could help the companies cut cost drastically and improve efficiencies.
“The delivery process during 2013-05 was all manual. While working with ITC, I noticed that the truck drivers had to be literally called manually and it led to delays, high distribution cost and other inefficiencies,” Singh said adding that the cost of distribution in India is twice as high as the developed markets as the supply chain and logistics segment is high fragmented at an estimated 10 million trucks.
The Bengaluru-based company, however, operates aggregates LCVs (light commercial vehicles) and MCVs (medium commercial vehicles), which forms the largest pie of the total share. These trucks are also ideal for the intra-city transportation as the vehicles can manoeuvre in smaller lanes and traffic and do not have any entry restrictions in cities. LetsTransport helps in the deliveries of goods for companies in sectors such as Retail, FMCG, consumer durables, and e-commerce. Consumers also use LetsTransport during house shifting.
Operated by Diptab Ventures Pvt. Ltd, LetsTransport’s existing investors include Rebright Partners, NB Ventures and GMO Venture Partners and had raised $4 million early last year.
The logistics sectors has suddenly picked up pace with a series of big ticket investments this year. BlackBuck raised about $27 million in October and is in talks to raise another $150 million, according to media reports.
Gurgaon-based Rivigo had raised $50 million in January this year. Another start-up ElasticRun raised about $8 million. Tiger Global-backed Delhivery has raised over $257 million so far which makes it the largest start-up in the logistics space so far.