Digital car services sector hits headlines for its first acquisition of 2018 as Noida-based startup MotorWhiz gets acquired by Blume Ventures-backed Pitstop.
The acquisition is a part cash-part stock deal and the startup hasn’t disclosed the essential financial details of the deal.
MotorWhiz was founded in 2016 by Shubhankar Rahul and Shiv Soni and offers mobile solutions for car services and repair jobs. The team of MotorWhiz will join Pitstop to build, expand and upgrade the latter’s product offerings in different geographies.
The acquisition synergy is apparent as Pitstop also offers general repair and maintenance services for cars through its doorstep service vehicles.
Bengaluru-based Pitstop was co-founded in 2015 by Mihir Mohan and Nirant Ramakuru and is currently operational in six cities. It works with over 150 garages and workshops as also directly with customers, offering regular car services, mechanical and electrical repair, body repair and doorstep inspection for cars.
Mihir Mohan, CEO of Pitstop, has said over the development, “We found a great synergy at the business and technology level with MotorWhiz team and this buyout would help us in expanding our offering at doorsteps across Delhi-NCR.”
Pitstop also works with fleets and leasing firms, including ride-sharing startups where it uses its proprietary SaaS-based Fleet Information System to provide a real-time view of service repairs, transparent vehicle maintenance and fleet management services.
Pitstop claims to provide services about 4,000 orders each month clocking revenues of about $307.6K (INR 2 Cr) on a monthly basis.
Last year, in 2017, Pitstop had raised $1 Mn Series A funding from Blume Ventures and Singapore-based Goldbell Group. Angel investors Anurag Srivastava, Shailesh Rao, Amiya Pathak, Rajesh Yohanan and Rahul Garg also participated in the round. The materialising synergy amongst car servicing companies such as Mahindra First Choice, SpareHub.com, MeriCar.com, etc. is pre-emptive of the growth that the auto industry in India will experience in the near future.
According to an IBEF report, the Indian auto industry, one of the largest in the world, accounts for 7.1% of the country’s GDP. The sales of Passenger Vehicles, Commercial Vehicles and 2 Wheelers grew by 9.17%, 3.03% and 8.29% respectively, during the period April-January 2017. The report also states that the automotive sector is valued at approximately $15 Bn in the top eight cities of which the after sales market is close to $7 Bn and growing at a healthy pace.
Also, India is a prominent auto exporter and has strong export growth expectations for the near future. Further, several initiatives by the Government of India including ‘Make in India’ and the major automobile players in the Indian market are expected to make India a leader in the two Wheeler and Four Wheeler market in the world by 2020.
Leveraging the synergy amongst the startups, deals such as the acquisition of MotorWhiz by Pitstop will spell prosperity for the mobile or digital car services solutions and the auto industry in India.