Mumbai-based online grocer Localbanya has raised an undisclosed amount of funding in its third round from Shrem Strategies. With this capital bolster, the company also forayed into the 'Oxford of East', Pune, market. Prior to this round, the company had raised two rounds from BCCL’s Springboard Fund and Karmvir Avant Infotech.
The company which delivers groceries and household needs to customers’ doorsteps is now looking to take the brand to other major metros in the coming three months, and starting operations in Pune is the first step in this process. The investment was made in the second half of last year, but the company made the announcement now.
At present, LocalBanya processes close to 900 deliveries on a daily basis in Mumbai with an average basket size of Rs.1,400. Importantly, it claims to achieve 98% punctuality in terms of order fulfilment.
Speaking about the investment, NitanChatwal, Promoter of Shrem Strategies, said, "Localbanya is one of the established players in the online grocery segment in Mumbai having been in operation for close to three years. They have put in place an aggressive expansion plan for 2015 to take the brand across India. The online grocery market is set to grow very rapidly in India over the coming years and we felt now is a good time to get in. We felt these two crucial factors are perfect right now and it falls in line with our investment philosophy. The Localbanya team has done a fantastic job so far and we want to be part of their journey."
Localbanya was the first player to enter the online grocery market in Mumbai back in 2012. Currently, it has a database of over 1 lakh customers and lists over 14,000 products on its platform. Groceries and staples lead the sales at Localbanya followed by dairy products and household supplies. Besides this, it also offers fresh veggie and fruits.
“The launch of our services in Pune coupled with a fresh round of funding, sets us on our way to the next phase of our vision – taking brand Localbanya to as many Indian households as possible. We have gained a lot of experience
here in Mumbai and feel this is the right time to expand our operations. If all goes well, we hope to be in four to five additional metros very shortly,” added Rashi Choudhary, Co-founder, Localbanya.Recommended Read: Grocery and veggies e-tailer LocalBanya processes 600 orders daily, to raise $5M soon
Last month, Gurgaon-based mobile centric hyperlocal grocery delivery service PepperTap raised an undisclosed amount of seed funding from Sequoia Capital. Bengaluru-based fruit and veggie e-tailer FreshWorld secured an undisclosed amount from Infosys Co-founder Kris Gopalakrishnan and the Indian Angel Network.
Localbanya competes with heavily-funded Bigbasket in Mumbai and Pune. In 2012, Bigbasket had raised $10 million from Ascent Capital and earlier this year secured funding from Singapore-based fund LionRock capital. Besides Bigbasket, Localbanya also faces competition in Mumbai from Unilazer backed online grocery store, Ekstop.
Unlike other verticals, online grocery space didn’t attract VCs interest in galore but things have been changing with Bigbasket, Localbanya, Ekstop, Peppertap and ZopNow, which are scaling fast with venture backing. Apart from the above players online grocery startups are also raising money which reflects the increasing faith and appetite of investors in grocery e-commerce space.