DriveU, India’s first and largest on-demand driver aggregator acquired Chennai-based DriversKart, an on-demand driver-service provider serving primarily the business segment in an all-equity deal. With this acquisition, DriveU consolidates its dominant position in the industry, catering to both consumers and businesses across 6 largest metro cities (Bengaluru, Mumbai, Chennai, Delhi NCR, Pune and Hyderabad). Unitus Seed Fund, India’s leading impact venture fund investing in early-stage startups innovating for the masses invested in DriveU in February 2016.
“With this acquisition, DriveU continues to consolidate its position as India’s premier driver aggregator for both consumers and businesses. Increasingly, we see the sharing economy offering opportunities to leverage our driver services as well. DriveU now plans to expand to over 10,000 drivers and 10 cities by the end of the year,” said Ramprasad (Rahm) Shastry, CEO, DriveU.
This is DriveU’s second acquisition since its inception as exactly a year ago the Bengaluru-based company had also acquired CallAtHome, a driver booking platform based out of Gurgaon, for an undisclosed amount.
Since inception, DriveU has delivered positive unit economics, with the business growing 20 per cent month-on-month and has successfully managed to increase its drivers’ incomes by 2x. DriveU offers a reliable, transparent service to its customers at a flat rate of INR 99 per hour locally and INR 999 per 24 hours for outstation travel. On an average, DriveU customers are willing to spend 2x more than what they would for an average cab ride today – primarily owing to the high-quality and convenience of service that DriveU offers. This translates into a healthy income for the driver and for DriveU. On an average, drivers earn a steady monthly income of INR 25,000 – INR 35,000, while some earning more than INR 40,000. At the same time, DriveU also eliminates the burden of EMI payments, fuels bill and vehicle maintenance for the drivers.
“With deteriorating quality of service and increasing fares, customers’ preferences are slowly shifting back to using their private cars with on-demand driver services. DriveU’s growth is a testimony to the same. Both, DriveU and DriversKart have maintained price discipline and built sustainable businesses, benefitting customers and significantly increasing drivers’ incomes. With this acquisition, DriveU will now offer a compelling service to the B2B segment as well,” said Vinit Srivastava, CEO, DriversKart.
Post-acquisition, Mr. Vinit Srivastava, CEO at DriversKart will take an advisory role with DriveU and Ms. Kopal Maheshwari, COO at DriversKart will head the B2B business at DriveU.
Commenting on this move, P D Sundar, Head of QuikrServices who has worked with both DriveU and DriversKart, said, “At QuikrServices, on-demand drivers is one of the top 5 categories on our platform and we see a tremendous growing opportunity for this category. This merger will only help provide larger pool of service providers and build a robust ecosystem”.
“We were attracted to DriveU as they have a business model with a price discipline from the get-go. They neither offered deep-discounted services nor do they lose on each trip. At the same time, they wanted to ensure that their drivers earn sufficient income and have a sustainable lifestyle. We are excited to have DriveU in our portfolio,” said Will Poole, Co-founder & Managing Partner at Unitus Seed Fund.
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