Jugnoo, a startup that provides an Uber-like service for auto-rickshaws in India, has closed out its Series B round having raised a total of $10 million. Investors included Snow Leopard, Rocketship.vc, Alibaba-backed payments firm Paytm, and the CEO of Snapdeal-owned Freecharge.
‘Always be raising,’ they say, and in Jugnoo’s case the company has taken that to heart. After landing a $5 million Series A round last summer, it raised an initial $3 million Series B in November, before it added a further $2.5 million in January. This is the final close, a Jugnoo spokesperson tells TechCrunch, and it adds $4.5 million to the coffers to take this Series B to the $10 million mark.
Jugnoo claims to have 2.6 million registered users across 30 cities in India. That’s up from January, when it told us that it had two million users in 22 cities. The company is still telling media that it process over 30,000 rides per day, but it did say the number of vehicles on its platform has risen from 6,000 in January to “over 10,000” today.
Auto-rickshaws are a ubiquitous and low-cost transport option across many cities in India. While taxi hailing is moving to mobile at a rapid pace through the likes of Uber and Ola, its India-based rival which is valued at $5 billion and has raised over $1 billion to date, the auto-rickshaw business has transitioned slower.
Uber shuttered a brief trial of an auto-rickshaw service last year while Ola offers a service, which just underwent a major expansion this month, but Jugnoo is confident that by focusing on the segment 100 percent it can win out.
In particular, it doesn’t offer the deep discounts to passengers and subsidies to drivers that Ola and Uber do, instead it is focused on augmenting the existing offline demand. The goal is creating a more sustainable business which is an asset to drivers, not just easy money.
“We want to drive utilization up to 60 percent for drivers, then the loyalty forms,” Jugnoo co-founder and CEO Samar Singla told us in January.
Typical fares are lower, but Singla believes the total addressable market makes it attractive one at the right scale.
“Uber and Ola are for the top 20 percent of people, we’re for the bottom 80 percent,” he added. “[The total volume of rides per day] is thirty times bigger than cabs.”
Right now, Jugnoo is just focused on consumer trips. It briefly offered a delivery service but closed that down due to an issue meeting apparent high demand from customers. The company plans to re-enter that space in the next year or so with increased capacity.