WATCH: Dunzo CEO Kabeer Biswas on the hyperlocal delivery startup’s B2B foray and expansion plans
Bengaluru-based startup Dunzo, which started life as a WhatsApp-based service, now runs all kinds of errands for customers in four cities. In a conversation with YourStory, Dunzo Co-founder and CEO Kabeer Biswas talks about Mumbai expansion and their recently launched B2B focus.
Monday June 10, 2019,
6 min Read
Love ‘em or hate ‘em, but it seems everyone is ‘dunzoing,’ or outsourcing all their tasks, to Dunzo. Thanks to the convenience afforded by Bengaluru-based hyperlocal task management startup Dunzo, ‘dunzo’ has fast become a verb as more and more customers across several Indian cities ‘dunzoit’.
Soon, thanks to Dunzo’s recently launched business-to-business (B2B) service, many local businesses in India’s top cities will also be 'dunzoing' it. In doing so, the startup, which aims to be the logistical layer of the top 10 Indian cities, is building deep moats for its business, say industry experts. This, especially at a time when competition in the delivery and logistics space is heating up.
Founded in 2015 by Kabeer Biswas, Ankur Aggarwal, Dalvir Suri, and Mukund Jha, Dunzo first started operations on WhatsApp. Kabeer’s idea was simple:
what if there was someone who could complete your list of tasks for you when you needed them to?
In a conversation with YourStory, Kabeer, Co-founder and CEO, talks about Dunzo’s recent foray into the B2B space, its journey so far, and how the startup is making it easy for people to have more time on their hands by outsourcing mundane tasks.
The hyperlocal task-management startup shot to fame in 2017 when it became the first company in India that Google invested in, when it pumped $12.3 million into the startup.
In the past few months, Dunzo has raised additional Rs 80 crores ($11.5 million) in funding from different investors, including Google, and is present in Bengaluru, Gurugram, Chennai, and Hyderabad.
When asked, what about Mumbai? Kabeer says, “In the next 60 days. Mumbai is a city that needs the highest efficiency and operational intensity, and, of course, money.”
So do they have the money now? A non-committal Kabeer adds: “We have enough to begin operations in Mumbai.”
Dunzo uses AI to manage customers tasks that include fetching something you forgot at home and need it at the office, to asking for a pickup-and-drop. Or you need your dry-cleaning fetched for an important meeting the next morning or have a document to be photocopied and delivered to your bank manager? Dunzo does it all.
The B2B push
Today, Dunzo not only completes your tasks but also has its unique B2B business, where business deliveries and tasks can also be managed. And going forward, that’s the space the startup is eyeing to scale its operations.
“The market is difficult. People had burnt their fingers after the bets they had made in the hyperlocal business. And with the bigger players coming in, the differentiator may just help,” says a market analyst of a top consultancy firm.
'Checkout with Dunzo' opens up the possibility to tie-up with any store, which has an online presence through its website or app, empowering businesses of any size to have hassle-free logistics support. The service, similar to a payment option, lets users opt for faster delivery through a Dunzo partner, at the time of checkout. Says Kabeer,
“The idea is to give more power and control in the hands of the small businesses. We are giving them the power to be online, understand their customers and enable delivery for them."
The team had piloted the feature with confectionery chain CakeZone in Bengaluru, and will soon expand to other retailers and locations.
Praveen Kavuri, Co-founder & CEO of CakeZone, said in a press statement,
"With evolving consumer needs in retail, we are always on the lookout for the most convenient and reliable delivery options. Quick delivery is one of the vital factors in the retail food industry. Customers essentially look for speed and convenience and Dunzo is helping us bridge the gap with its quick and in-time delivery."
Karthik Reddy, Managing Partner, Blume Ventures, an early investor in Dunzo says,
“When we put in our bet in Dunzo, it was being run on WhatsApp and the company was in its early stages. And practically every quarter, I have seen the company add in layers with the idea of making tasks simpler and easier for the users and even the delivery partners.”
Standing up to the competition
The on-demand business is a tough one – the frequency of the business needs to be high, and there needs to be a strong liquidity of demand and supply.
An analyst of a top consultancy firm, on account of anonymity, had earlier remarked to a question by YourStory, “The product is great, the way the operations run is seamless, but the question arises in the scale.”
Dunzo now has competition from some top unicorns, including Swiggy, with its Swiggy Stores, and Bigbasket with its ‘Daily’ services. According to market talk, both foodtech rival unicorn firms, Swiggy and Zomato, are looking to acquire Dunzo.
Interestingly, the Google-backed firm responded immediately to Swiggy Stores’ launch with the creative: “Welcome to our Space.”
When asked about the competition, Kabeer responded with his usual humour, “I wish their investors loved us more!”
Building the brand
Today, 80 percent of their tasks are completely automated and run without any human intervention. This is what has enabled them to scale. In October last year, Dunzo completed over two million transactions to date. It completes an average of 65,000 to 75,000transactions every day across four cities.
“The idea is to reduce friction in completing a particular task. The focus is to reduce the cost per transaction, and that can be done by reducing the time taken in reaching a pickup point,” Kabeer says.
To add a layer of automation, Dunzo has built in merchant and product tie-ups, and focused on cataloguing. Now, stores and restaurants have a list of items, which makes it easy for users to choose the items they want.
At present, Dunzo charges its merchant partners a commission ranging between 10 and 12 percent of the total delivery cost. The company has tied up with over 350 merchants across the four cities it operates in.
It is like Karthik says,
“Hyperlocal businesses are tough, but Dunzo has proven that there is a need in the market. It has gotten a cult following of sorts. If you look at the behaviour that they modelled in the market, the customers and the metrics, it’s gotten stronger.”
While Dunzo makes your life easy by crossing many points off your to-do list, it will be interesting to see how the company continues to scale, and what new technologies are added to further simplify the process.