Logistics Startup Rivigo Raises $50 Mn Funding From SAIF Partners, Warburg Pincus

Gurugram based logistics startup Rivigo might have broken into the Unicorn club with its latest $50 Mn Series D funding round, led by two of its existing investors Warburg Pincus and SAIF Partners. As per an ET report, this round of funding is believed to have valued Rivigo at about $1 Bn post-money.

While this could not be independently verified, it would make Rivigo one of the fastest startups to achieve the coveted Unicorn status. As per documents filed by the company, the round is believed to have closed 30 days ago wherein the company had allotted 8,231 Series D compulsorily convertible cumulative preference shares, at $4K (INR 2,53,765) per share, to SAIF Partners India for a total amount of $32.97 Mn(INR 208.88 Cr).

Also, it allotted 4,477 Series D compulsorily convertible cumulative preference shares to Warburg Pincus arm Spring Canter Investment for a total of $17.93  Mn (INR 113.61 Cr) as per its board meeting held on December 15, 2017.

It is, however, unclear if the latest funding is part of a larger round.

A Quick Look At Rivigo And Logistics Sector In 2017

The latest round comes within months of speculation that Softbank was looking to infuse $200 Mn in Rivigo, which would likely take Rivigo’s valuation to about $1 Bn, crowning it a Unicorn. The status of the proposed investment however remains unclear.

Founded in 2014 by Harvard alumnus Gazal Kalra and IIM Lucknow alumnus Deepak Garg, Rivigo (previously TrucksFirst) claimed in March 2017 said that it owns and operates over 2100 trucks and has a pan India network across 150 locations.

Till date, Rivigo has raised close to $125 Mn funding in equity and debt finance. The startup received about $75 Mn from an affiliate of Warburg Pincus in November 2016. Later in March 2017, it raised about $15 Mn (INR 100 Cr) debt finance from undisclosed private sector lending banks.

While Rivigo has emerged as the investors’ favourite in recent years, the startup has also been trying to be profitable while it strives to reduce losses. For FY 2017, while losses widened to $21.1 Mn, both revenues and expenditure rose. Total expenditure more than tripled to $80.97 Mn(INR 525.3 Cr) with other expenses also tripling to $59.87 Mn(INR 388.4 Cr). Finance costs increased 240% to $3.59 Mn (INR 23.3 Cr).

One of the reasons behind rising expenses was also the rise in workforce given that the company also increased its workforce, and there was a three-fold rise in employee benefits, to $11.43 Mn (INR 74.2 Cr). Then buying trucks is also one of the biggest expenses for the company. In August, Rivigo agreed to buy 500 trucks from Ashok Leyland for $18.49 Mn (INR 120 Cr).

Nevertheless, Rivigo’s upward stride has continued. Last year, Rivigo was also listed in the Top 40 breakthrough brands in a report released by global brand consultancy Interbrand. Rivigo is working on a new product to disrupt the logistics space called Apollo, which the company is betting on to automate its entire trucking operations, with no manual intervention. In the uber-competitive logistics space, it competes with equally strong investor-backed startups like Blackbuck, Locus, Locanix, ElasticRun, 4tigo Network Logistics, among others. Last year, post raising a $70 Mn Series C Funding, logistics firm BlackBuck also raised venture debt of $23.05 Mn from InnoVen Capital.

As per Inc42 Datalabs funding report for H1 2017, in terms of the amount being invested, transport and logistics took the third and fourth spots, respectively, with $528 Mn and $271 Mn in funding. In total, the logistics sector received over $271 Mn over 18 deals in H1 2017. Delhivery, Ecom Express and Rivigo received the maximum funding during this period. With its latest funding round and possible entry into the Unicorn Club, Rivigo will now be in a much more formidable position to give other logistics startups a run for their money.

[The development was reported by ET]