Jugnoo, an Indian auto rickshaw-hailing startup has received $5 million in Series A funding from a round led by Snow Leopard Ventures and mobile commerce firm Paytm and many other investors from its angel round.
The startup Jugnoo that operates on-demand auto rickshaw, is based from Chandigarh and owned by SoCoMo Technologies. Despite the many competitors in the field of auto-rickshaw hailing for transport like Uber, Ola, mGaadi and PoochO, Jugnoo has a competitive edge by bringing together transit and on-demand delivery under one business model. Founded by Samar Singla in November last year, the startup has more than 150,000 registered users in four small cities and makes around 2,500 transactions per day. The startup is growing 20% a week and is aiming at online sales of Rs.1000 crore in the nest 4 to 5 years.
Considering that many customers were taking auto not for rides but for delivery and pick up items, Jugnoo launched two new services for its customers. They are Jugnoo meals and Jugnoo Fatafat that deals with restaurant orders and on-demand deliveries from local stores. The founder of the company Singla strongly believes that by offering a better value proposition for driver and getting repeat customers, the company can stand apart from its other competitors.
“Drivers because they want to work with a company that focuses on auto rickshaws instead of using them as a backup,” said Singla. He also added, “There are ten times more auto rickshaws in India so we can handle supply and demand much better. People who want the quickest and cheapest means to get from point A to point B will choose us, but if a person want an air-conditioned car he or she will probably go for a Uber.”
Jugnoo plans to use the newly raised fund to expand its business in more places. The startup has previously secured $1 million from seed round from Rajest Mathur, co-founder of Junglee that was acquired and relaunched by Amazon. Vikas Taneja, partner and managing director of BCG Group, Kirloskar Brothers and others took part in the seed round early this year. For Snow Leopard Technology Ventures, this is the third company its invests in apart from Voyalla, imitation jewelry e-tailer and LivQuik, the payment solutions firm.
Singla maintains, “It seems we are the first company in the country to successfully do both hyperlocal delivery and transportation over same infrastructure layer with a significant ratio of both. I am very glad to have Snow Leopard and PayTM on board for or Series A funding. Their vast experience in building successful consumer initiatives will help Jugnoo in its next phase of growth.”
Although began in 2012, the startup started its operations only in last November. The company currently functions in four cities – Chandigarh, Ludhiana, Amritsar and Jaipur and is looking to expand into more places soon.