Ali Hasan
Delhivery has become the Shipping Gaint that India needs
Introduction – It doesn’t matter what you want to ship, a small package, your furniture or maybe all your stuff. You always need a reliable source of shipping experts that can handle your stuff with expertise and ship wherever you want to. Earlier we had many brands that could handle shipping but now we have a new contender in the field that wants to challenge the champions and become the new undisputed champion of shipping in India.
Delhivery is relatively a new startup that was started in 2011 and might just have the punch to knock their competitors as market leaders. While the business has been growing and they are becoming more and more prominent, will they ever become the next big thing in shipping? That’s a question that we will try to answer today and we will cover their journey so far. Read along to know more.
Early Days – Delhivery is an Indian delivery company which is headquartered in Delhi, India (Duh) and handles various shipping services such as courier services, transportation, warehousing, freight, and order fulfillment services. It was founded in 2011 by 5 co-founders who are as follows:-
- Sahil Barua – CEO
- Mohit Tandon – CSO
- Bhavesh Manglani – COO
- Suraj Saharan – COO
- Kapil Bharati – CTO
They have a vision to become the operating system for commerce in India, through a combination of world-class infrastructure, logistics operations of the highest quality and cutting-edge engineering and technology capabilities. I hope they achieve it as soon as possible.
It all started when the co-founders ordered food from a local restaurant and the food was late. They immediately knew that they could provide a solution and fill the gap with their exceptional services. They went into food delivery business but later changed the business model to E-commerce shipments after realizing the potential of it. Since then the company is growing at a good pace and they have never looked back.
Marketing Strategy – Delhivery used a tagline “Khushiyon Ka Swaagat, Khushiyon Ki Delhivery”. In this simple marketing campaign, they focused on the fact that you get your shipment on time without any delay and this will bring happiness to you as waiting for a package that’s been shipped is a pain in the a**. It was a simple yet effective marketing campaign.
Funding – Delhivery has raised a total of $959.6 million in funding over 10 rounds. Their latest funding was raised on Dec 15, 2020. They have a total of 9 investors, 8 of whom are lead investors. Some of their investors are as follows:-
- Steadview Capital
- Canada Pension Plan Investment Board
- SoftBank
- The Carlyle Group
- Fosun International
- Tiger Global Management
- Nexus Venture Partners
Revenues and Losses – In the financial year 2019-20 (FY20), Delhivery managed to cut its loss 6.8x, from INR 1,781 Cr in FY19 to INR 284.13 Cr. The decline in losses comes ahead of a critical year for the company. The company also reduced its expenses by 6% to INR 3,250.4 Cr and increased its revenue by 74% to INR 2,986.4 Cr in FY2020.
User Base & Valuation – According to their website, they have successfully fulfilled over 850 million orders to more than 300 million households across India. They have 24 automated sort centers, 85+ fulfillment centers, 70 hubs, 3000+ direct delivery centers, 7500+ partner centers, 15000+ vehicles and 40000+ team members that makes it possible to deliver a million packages a day, 24 hours a day, 7 days a week, 365 days a year.
This means that they have a strong user base that’s growing with each passing day. They are present in more than 2,300 cities, have over 10,000 customers, have over 500,000 sellers and as mentioned earlier, they ship more than 1 million products a day. The company entered the unicorn club in 2019, after raising $413 million from SoftBank and other investors. They have a current valuation of less than $3 billion but they target to achieve a $4 billion valuation when they launch an IPO later in 2021.
Acquisitions – Delhivery has so far made 5 investments. Their most recent investment was on November 30, 2015.Their investments are as follows:-
- Okipod
- in
- Opinio
- Rocketbox
Controversies – Delhivery is a brand that has no major controversy but since its name has Delhi in it, it created a bit of dispute.
Once the matter was in court due to its unique name, then the Delhi HC on 12th October, 2020, vacated an interim injunction effectively permitting the Respondent (Treasure Vase Ventures Pvt. Ltd.) to use the impugned trademark ‘DELIVER-E’. In doing so the court held that the Applicant’s (Delhivery Pvt. Ltd.) registered trademark ‘DELHIVERY’ is phonetically similar to the English word ‘delivery’ and is a generic mark, not eligible for benefit of statutory rights.
The court reiterated that unless a generic mark has achieved distinctiveness, it cannot be accorded protection under law, and to determine the ‘so claimed’ distinctiveness of the mark at the interim stage would essentially amount to conducting a mini trial, which is prohibited.
Present Conditions & Future Plans – They plan to have an IPO in late 2021 and take the company public. This will value them at approximately $4 billion in valuation. “The appointment of bankers is underway. The formal launch may stretch to the September or December quarter,” a senior executive involved in the process told ET, which first reported the development.
The public listing may also include a secondary sale of shares to facilitate the exit of some existing private equity investors. The company has been trying to go public for the last 2 years, but plans for the same in 2019 coincided with the Indian general elections. It was probably not the best time to go public because a lot of focus was going to be on elections.
Conclusions – To sum it up, Delhivery has it all, a strong team, solid growth, presence in multiple cities and a strong business model to cope up with the rising demand. The way we see it, they have everything to be the next big thing in their respective industry. They are bound to be the next behemoth and probably your next shipping carrier for all your products. We hope they achieve the same kind of respect and recognition in the whole entire world as they did in India.
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