Shubham Saroj
Dunzo will Deliver anything for You
Introduction – Dunzo is a hyper-local Indian company that provides delivery services in various Indian cities. As of now they are present in a total of 8 cities. The company also operates a Bike Taxi Service in Gurugram. It is headquartered in Bengaluru, India and was founded in July 2015 by Kabeer Biswas, along with other co-founders Ankur Agarwal, Dalvir Suri and Mukund Jha.
Dunzo wants to change how we shop and pick up stuff. Especially for those people who are super duper busy and don’t have any time to shop for essentials or any other stuff that they need. This is where Dunzo steps in and saves the day for these individuals as it promises to change the way you move things, how you shop and lets you access your city like never before. Their app connects you to the nearest delivery partner who can make purchases, pick up items from any store or restaurant in the city and bring them to you.
It’s never easy to make purchases or drop off packages when you get busy with work, get stuck in traffic, or you might even end up forgetting about it completely. All you need to do is, Tell them where to go, what needs to be done and when. What happens next? Sit back, and let them worry about your task-at-hand. You could say that they are always on the move for you.
But do you really think that they can pull off such a task in delivering your stuff to your doorstep every time you order something? Well today we will answer this question and get to know what’s happening with Dunzo, where they are and what the future holds for them. So read along.
Early Days – Dunzo was founded in July, 2015 by Kabeer Biswas, an alumnus of the University of Mumbai. Before Dunzo, Kabeer was working in Airtel. After leaving the company, he founded a company called Hoppr, which was acquired by Hike in 2014. Dunzo started out as a small WhatsApp group, and then transformed into a hyper local, app-based service.
The idea was the result when the co-founder was frustrated due to the fact that he had to do a lot of daily chores that didn’t lead to any great results but were necessary. He realized that there isn’t a startup yet that could provide relief by helping people to do their daily chores. Then he decided to test out the idea and as a result Dunzo was formed.
Before the launch of Dunzo, the idea was tested with the help of a WhatsApp group. A group where people used to post about the stuff that they wanted to be completed and this was the beginning of Dunzo. When the co-founder received phenomenal response through the WhatsApp group, he decided to take the business full time and register it under the name of Dunzo.
They offer various logistics services such as:-
- Pick & Drop of Packages
- Online Restaurant Discovery
- Online Ordering
- Grocery Delivery
- Laundry Delivery
- Medicine Delivery
- Pet Supplies
- Local Couriers
- Bike Taxi
They offer live tracking of your delivery as well as the option of scheduling your deliveries. One can also become a delivery partner if he wishes to work and earn. You can join their team and you have the option of picking your working hours where all the deliveries are made within city limits. You’re paid in direct proportion to your deliveries. Dunzo claims that they have the best compensation package in the market for their delivery partners.
Marketing Strategy – They used a simple 40 second ad where there was a delivery boy named Dunzo Guy who can deliver anything from medicines to flowers, from food to pet supplies, from groceries to your stuff to you at any time you want. This ad was simple yet effective. They also used a hastag named #Dunzoit.
Revenues & Losses – Dunzo saw its revenue from operations grow 35X to Rs 27.5 crores during FY20 from making less than Rs 77 lakhs in FY19. Breaking down this number further, around 53.2% of this revenue was earned through commission charged from merchants on sales. Such collections shot up 21.4X to Rs 14.6 crores from only Rs 68.2 lakhs earned in FY19.
They may have raised their revenues but they still aren’t profitable and have seen huge losses. The company’s net cash outflow from operations swelled up 2.14X to Rs 330.8 crore in FY20 from the outflow of Rs 155 crore in FY19.
While the company’s EBITDA margins improved from -4695.45 % in FY19 to -1009.87%, these numbers are unsustainable for even an early growth stage venture let alone for one in the space for six years now. The forest fire of cash burn pushed Dunzo’s annual loss to Rs 338.4 crore in FY20, doubling from loss of Rs 168.9 crore in FY19.
Funding – Dunzo has raised a total of $128.4 million in funding over 15 rounds. Their latest funding was raised on Jan 19, 2021 from a Series E round. They have a total of 24 investors out of whom 7 are lead investors.
It raised its first round of funding of US$650,000 in March 2016. In December 2017, Dunzo received US$12 million in a fresh round from Google. This was Google’s first direct investment in a startup in India. On 29 August 2019, Dunzo raised ₹34.56 crores funding by issuing debentures as well as Series C1 preference shares to existing investor Alteria Capital.
There major investors are as follows:-
- Alteria Capital
- Lightrock
- Lightbox
- Evolvence India Fund
- Aspada
- Hana Financial Investment
- Pivot Ventures
User Base & Valuation – As of 2021, Dunzo is present in 8 cities and claim to process more than 10 lakh orders per month. Their android app is downloaded more than 5 million times. Dunzo was valued at more than $250 million after it received Rs 27.5 crores in funding in December 2020 from their Series E round.
Partnerships – In May 2020, Dunzo partnered with FMCG major PepsiCo to deliver its snacks brands such as Lay’s and Kurkure to customers’ doorsteps in Bengaluru amid the lockdown due to the Covid-19 pandemic in India in keeping with Pepsico’s “Direct-to-Customer” initiative. In the same month, it also partnered with digital payments app Google Pay to provide grocery and medicine delivery, bike pool, pickup-and-drop, among other services.
Controversies – Dunzo isn’t involved in any major controversy as of now but once there was a data breach in July, 2020 where the personal data of 3.4 million users of Dunzo was exposed.
“Our investigation so far suggests that the servers of a third party we work with were compromised. This allowed the attacker to get unauthorized access and breach our database. This database contained a user phone number and email address information. No payment information like credit card numbers was compromised as we do not store this data on our servers,” Dunzo had said in a statement then.
Present Time & Future Goals – They have improved their average delivery time and now you get your stuff under 24 minutes. Earlier this time was around 40-45 minutes. This is good news because the time is actually half than what it used to be.
They are also trying to use drones for delivering stuff in the future. The stuff will be delivered to a warehouse or delivery center near you. The distance could be approximately 500 meters to 1 kilometer. Then from there a delivery partner will pick your stuff up and deliver to your doorstep. As of now they have no plans to file an IPO in the future. They would like to first become profitable or break even before filing for an IPO.
Conclusion – The way Dunzo was started and the way it’s growing is a case study in itself. To conclude things up, all we can say that we have high hopes from Dunzo. It’s a good idea that has been executed well. If they keep on focusing on their core areas and keep on improving themselves, they can be the next big thing and a household name for transporting stuff.
We wish them all the very best and hope one day we will get to use their services when they finally expand their services and enter our city. Until then we can wait, keep ourselves updated with all the latest news regarding startups and their ecosystem.
