Zoomcar, one of the largest providers of online rental car services in India has raised another $25 million in a Series C round, led by Ford Motor Company and a couple other investors. This investment has bumped the company’s total equity investment to a whopping $46.5 million.
Ford Smart Mobility, the investment of Ford Motor Company has pumped $15 million into the startup and led the funding round. This marks Ford Motor’s first investment into an Indian startup, reports Business Standard. The remaining $10 million has been split and invested by Sequoia Capital and Reliance Ventures. Zoomcar has previously raised over $21 million in a total of five funding rounds, which has seen participation from about 16 investors since 2013.
In the wake of the upcoming investment round and with the aim to achieve profitability by 2017, Zoomcar had recently made the switch to a marketplace model. The newly infused funds and marketplace model will now help the startup expand into new markets. It can add more cars to its already huge fleet, which can then be leased by Zoomcar users and other individuals on a revenue-sharing basis.
According to anonymous sources close to the company’s developments say, the car rental platform is already EBIDTA-level profitable in several cities it is currently operational in. The car-rental company’s revenue is soon expected to touch $25 million and it is now also closing in on becoming country-wide profitable in the next three months.
Zoomcar, which was launched by duo Greg Moran and David Back back in 2013, aimed at organising India’s massively scattered car rental business via its desktop and mobile platform. The startup currently boasts to have a fleet of over 1,600 cars but plans to expand it four times upto 7,000, with a planned expansion in another 15 cities.
The service offers standardised(but also flexible) renting rates across the country, bringing in much needed transparency to the usually shady transactions which happen in this business. It currently has over 250 pick-up spots spread across its major operational cities, including Bangalore, Mumbai, Delhi, Pune, Chennai, and Hyderabad.
Zoomcar’s toughest competition right now, is perhaps carzonrent, which offers similar services, however with a chauffeur. But, the company now also faces competition from young startups, including the likes of JustRide — which has been selected to be a part of the next batch at Y Combinator.
It also faces some competition from cab-aggregator Ola Cabs, who recently has also step foot into the car rental segment. The company is now offering rental services at two tariffs — Rs. 500 for 40 km/4 hrs for a hatchback vehicle as compared to Rs. 1,500 for 80 km/8 hrs. You can also avail a sedan car, and the driver will drop the vehicle at the pick-up location you choose.