Bangalore-based Shadowfax, India’s market leader in the Online-2-Offline (O2O) logistics segment, announced today that it has closed $22 million in Series C funding led by NGP Capital. Qualcomm Ventures (the investment arm of Qualcomm Incorporated), Mirae Asset and existing investor, Eight Roads Ventures, also joined the oversubscribed equity round.
Shadowfax survived the O2O logistics industry’s chaotic infancy period to emerge as the winner amongst India’s hyperlocal delivery start-ups. The company’s unique futuristic platform makes delivery seamless for diverse categories of products like grocery, food, fashion and electronics. Shadowfax currently fulfils 90,000 unique orders per day. It has multiplied its capabilities three-times in the last 16 months alone and is projecting 150% year-on-year growth for the next five years. The company will use the funds for a concentrated 360 scale-up and by the year 2021 it aims to connect 4 lakh new businesses and Delivery Partners to its platform, up from the current 40,000 connections.
Speaking on the funding, Abhishek Bansal, CEO, Shadowfax, said, “We are extremely glad that the market has recognised our work and our potential. This latest funding is a manifestation of the investors’ faith in us and our technology. We are ready to take multiple steps forward towards our mission of connecting the next million micro entrepreneurs and suppliers in logistics using a singular platform to bridge the information gap and eradicate inefficiencies across the value chain.”
He further added, “Shadowfax is continuously growing and delivering enviable results in a demanding and burgeoning O2O logistics sector where many other players have not been able to survive. Our technology, Frodo, gives us the edge by driving cost optimisations and enabling us to achieve higher service levels. The unique Shadowfax platform works on the concept of flattening the demand curve across the day which also ensures a much higher earning for our rider partners”.
NGP Capital has been investing in the sector globally. Upal Basu, Partner at NGP Capital said, “The rise in Indian consumers’ expectations for door-step deliveries at a time of their convenience has created a critical need for a national last-mile, independent logistics provider that can serve the needs of these demanding consumers and diverse suppliers at scale. The team at Shadowfax has demonstrated its ability to scale and serve customers using sophisticated mobile technologies and strong execution capabilities to create India’s last-mile logistics leader. We are excited to be a part of Shadowfax’s team and look forward to helping the company continue its rapid growth”.
Speaking about this investment, Varsha Tagare, Managing Director of Qualcomm Ventures India, said, “We were impressed by Shadowfax’s ability to deliver efficiencies in the hyperlocal segment by harnessing the power of mobile. We look forward to supporting the company through our investment and enabling collaborations with technical experts, who have domain expertise in mobile, to help the company’s quest towards delivering enhanced user experiences”.
Ashish Dave, Head – India Venture Investments for Mirae Asset said, “As we move into the next phase of Indian O2O story, the market needs efficient and distributed hyperlocal logistics platforms such as Shadowfax that serve evolving customer needs of faster and cheaper product delivery. Shadowfax marks our first of many other investments to follow in India”.
Last month, Shadowfax started its WINGS program as an endeavor to converge small and mid-sized logistics entrepreneurs and assimilate kirana stores, transporters, franchises, DCOs (Driver cum owners) and individual vehicle owners.
Shadowfax previously raised funds amounting to $18.5 million from Eight Roads Ventures in 2015 and 2016.
Affirming his faith in Shadowfax, Aditya Gurunath Systla, Principal at Eight Roads Ventures, said, “Eight Roads Ventures’ backing of Shadowfax in this third funding round reflects our belief in the Shadowfax model and its ability to deliver outstanding results to customers. It’s been a fascinating ride so far, and we are excited to see the next chapter of the Shadowfax story unfold.”
Shadowfax, founded in 2015, has successfully outrun its competitors with its unique Frodo technology, an AI based location stream processing engine which enables high frequency decision-making which in turn drives cost optimisation and enables the highest service levels in the industry. Shadowfax has been able to maintain high partner efficiency which has enabled best in class unit economics of 20% on a transaction level.
Currently present in 80+ cities across India, the company plans to increase coverage to 100+ locations in the next three months.
Since start of this year, a number of logistics startup have raised funds in a continuous chain of funding rounds. In May, Chennai-based logistics tech startup FreightBro raised an undisclosed amount in a seed round from Suresh Kumar, former global CIO of Bank of New York Mellon. Prior to which, Bengaluru-based Mojro, raised $650K in a funding round led by 1Crowd and its investor community
This was followed by $2 million funding of Chennai-based Pando, in a seed funding round led by Nexus Venture Partners.
Mumbai-based startup in the CleanTech-led cold chain logistics startup, Tessol, recently raised an undisclosed amount in follow-on equity funding from early stage venture capital firm 1Crowd, and existing investors Infuse Ventures and Ankur Capital.