Chennai-headquartered Wheelocity has now secured a $15 million Series A2 funding round. The round was led by Lightspeed India Partners, an existing investor of the startup, and included the participation of Alteria Capital, Anicut Capital, and the company’s founder, Selvam VMS.
The proceeds of the funding round will be deployed towards deepening Wheelocity’s penetration in the market, expanding its presence from 3,500 villages to 20,000 towns and villages over the next 12 months. The startup aims to build a user base of 10 million consumers in southern India, as well as target the underserved populations in regions that remain largely disconnected from larger e-commerce platforms.
“India’s growth story is incomplete without the digital inclusion of our semi-urban and rural populations. It remains a very large, profitable and yet untapped opportunity. This funding from Lightspeed and other partners validates our vision of building a commerce ecosystem specifically designed for these markets, taking into account their unique challenges and opportunities,” Selvam VMS, founder and CEO of Wheelocity, commented on the matter.
“Wheelocity’s deep understanding of semi-urban markets, combined with their technology-first approach, positions them uniquely to capture this massive opportunity. We’re excited to continue to partner with them in this journey,” Rahul Taneja, Partner at Lightspeed, said. Lightspeed had also contributed in an earlier round of Wheelocity’s funding – at that time, the startup raised $12 million from Lightspeed, Anicut Capital, and others, to bolster its supply chain network.
Founded three years ago, in September, the startup initially operated on a business-to-business (B2B) model, collecting and providing fresh produce to quick-commerce platforms (including the likes of Swiggy Instamart, Blinkit, and Zepto). Last year saw a transition of its business model, however, as Wheelocity shifted to adopt a B2C model that catered to the needs of consumers in semi-urban and rural areas. “In our earlier avatar, we were basically a B2B operator and building supply chain network for quick commerce and ecommerce business. We completely pivoted in October 2023 and for the last one year we had been building this new B2C network,” Selvam said.
Currently, the firm operates in central Tamil Nadu and serves one million consumers. This is made possible by Wheelocity’s fleet of 1,500 electric three-wheeler vehicles, and a network of over 2,000 delivery partners, as well as a ‘phygital approach’ – a hybrid online-offline system wherein consumers can place orders through the platform’s app and receive deliveries via electric vehicles. In addition to this, Wheelocity also has over 60 dark stores across the state (where fresh produce is stored before being distributed to consumers).
The startup provides services in a very underserved area of the country – the market for rural and semi-urban commerce in India is enormous, with over 800 million people living in these areas. Yet, the number of e-commerce platforms catering to their needs is a handful, even as the market represents an opportunity worth over $1 trillion, driven by factors such as increasing smartphone penetration, improved internet connectivity, and more. This is where Wheelocity comes in. “We are now delivering and selling fresh commerce goods across towns and villages in our three-wheeler EV cart and we have built a unique phygital model. We use data and technology to map newer areas and consumers and use physical model to gain the trust of our consumers,” Selvam said.
