Bengaluru-based self-drive car rental marketplace JustRide has raised $3 million in funding in a bridge round from partners at seed accelerator Y Combinator and major global investors, including San Francisco-based Susa Ventures, Kima Ventures, Axan Ventures, SCM Holdings from London and IT-Farm from Japan.
The fresh capital will be utilised to amplify JustRide’s car sharing platform JustConnect and Yabber, an IoT device for cars that is based on the company’s Smart Vehicle Technology. JustConnect is a car sharing platform that helps car owners monetise their cars when not in use.
The startup last year raised $1 million in a funding round that saw participation from IAN Co-founder Alok Mittal, Niraj Singh, Nikunj Jain, Zishaan Hayath, Punit K Goyal, Anirudh Damani, Rohit Chokhan and Palaash Venture.
Mentored by Google’s Launchpad Accelerator program, JustRide caters to both vendors and peer-to-peer individuals. It leases vehicles from individual vendors and provides them minimum guaranteed returns.
The vehicles are upgraded with the company’s SVT service and rented out to individual customers for a minor service charge. The company claims to redefine its hyper-local service model to deliver vehicles in less than 10 minutes from their time of booking.
SVT taps into a vehicle’s electronic system and provides a real-time access to the location and performance parameters of the vehicle, ranging from tire pressure to the current load on the engine to the G-force experienced on each of the individual suspensions.
Ashwarya Singh, CEO and Co-founder of JustRide, explained,
"Car ownership in India stands at a meager 20 for every 1,000 individuals, in contrast to the US, which boasts of almost one car for every individual aged above 18. A vast majority in India do not have access to personal transport, presenting an extensive market for car rentals.”
“By leasing out their idle car, an average Indian, who earns $500 each month, can increase their income twofold. We have added 220 cars since piloting the concept in March. We are also keen on exploring our Smart Vehicle Technology,” added Ashwarya.
Growth metrics and revenue
JustRide has 150,000 users from Mumbai, Bengaluru and Pune, a base that is growing by 40 percent month-on-month. With a GMV of $3.5 million, the revenue of the startup is also seeing 40 percent month-on-month growth. Last year, it witnessed a revenue of $1.5 million, and is expecting to scale up by three to four times over the next year.
According to Abhishek, a single car in JustRide is effectively used by 13 customers in a month. It can rake in Rs 50,000 to Rs 60,000 during that time, of which 75 percent goes to the owner and 25 percent comprises JustRide’s revenue. The company aims to have a total of 2,000 cars in the next six to eight months.
According to Ken Research, the Indian car sharing market is poised to grow at 15 percent every year till 2018, providing a considerable opportunity to players in the space. Notably, while most car rental services in India operate under the traditional model of purchasing their cars, JustRide is not the proprietor of the vehicles it rents.
Sequoia-funded Zoomcar, Carzonrent and Revv are the primary players in the car rental space with which JustRide directly competes with. Zoomcar, in August this year, raised $24 million in its Series B round of investment, while Carzonrent raised Rs 80 crore from Sidbi Venture Capital, WestBridge Capital and others. Revv has seen funding as well, having raised a seed round from Myntra CEO Ananth Narayanan, more than 10 directors and partners from McKinsey, and others.
As the demand for car rental services in India rises, JustRide plans to switch to a marketplace model, where individual vendors could register their fleet of cars on the company’s website.
The company is planning to close a round of funding with $7-8 million from a clutch of marquee global investors to invest in its Smart Vehicle Technology.