Reliance Retail backs Dunzo, a Google-backed hyperlocal delivery startup with a $240 million fund. With this India’s largest retail chain looks forward to expanding to the instant commerce space, a category developing recently in South Asian markets this quarter.
Reliance Retail will be investing around $200 million with a 25.8% stake in the six-year-old startup. Dunzo operates an eponymous hyper-local delivery service in seven cities in India. The next round of $775 will be for the Bengaluru-based startup, the name of which has not been disclosed. The existing members such as Lightbox, Lightrock, 3L Capital, and Alteria Capital will also participate in the round.
Isha Ambani, Director of Reliance Retail Ventures Limited, in a statement, said, “We are seeing a shift in consumption patterns online and have been highly impressed with how Dunzo has disrupted the space. Dunzo is the pioneer of Quick commerce in India and we want to support them in furthering their ambitions of becoming a prominent local commerce enabler in the country.”
She further added, “Our merchants will get access to the hyperlocal delivery network of Dunzo to support their growth as they move their business online through Jio Mart.”
Dunzo offers customers a wide range of products to choose from several categories such as grocery, perishables, pet supplies, and medicines to dinner from their neighborhood stores and restaurants. Customers can use Dunzo to move their own items such as laptops, chargers, medicines, and lunch — around the city.
Dunzo debuted instant delivery space in Bengaluru last year, it offered customers delivery within 15 to 20 minutes. The company did not reveal any figures but said there was a 20% growth on a weekly basis.
Dunzo will be expanding its operations to eight cities across India and broadening its quick commerce play with the fresh funds.
Currently, it accounts for 3% of retail sales in India via E-Commerce in a country where small establishments and other neighborhood outlets are spread across cities, towns, villages, and slums across the country drive most of the sales in the nation.
Dunzo in the near future may pose a challenge to Amazon and Walmart-owned Flipkart along with other local food and grocery delivery startups such as Swiggy, Zomato, and newcomer Zepto.
According to Kabeer Biswas, co-founder and chief executive of Dunzo, the startup has found a “long-term partner with whom we can accelerate growth and redefine how Indians shop for their daily and weekly essentials. We’re excited by the traction and velocity that Dunzo Daily has achieved and over the next 3 years, we aim to establish ourselves as one of the most reliable quick commerce providers in the country.”