)
Start-ups in the truck market place, especially the online freight booking space, are attracting investors. A growing demand in the logistics sector due to the boom in e-commerce is the reason.
According to experts, the online truck services space will witness the kind of growth on-demand taxi aggregator services such as Uber and Ola brought into the cab booking space. Investors have also woken up to the huge opportunity in the business, whose revenue growth is pegged at 3x on a year-on-year basis. According to Venture Intelligence data, the sector raised $22 million during January-June, compared with zero investments in the year-ago period.
The $22 million comprises $10 million that TrucksFirst raised in April from SAIF Partners, Singapore Post, and McKinsey travel, transport and logistics director Thomas Netzer; the $6-million investment led by Accel India into Zinka Logistics; the $6-million investment in The Porter by Sequoia Capital India, Kae Capital and Angels during April-June; and the $0.25 million investment made by SoL Primero, Outbox Ventures and others in The Karrier in May.
Booking a truck for transportation has been a large pain point for customers including enterprises. There was no transparency in pricing, among other issues. The on-demand service, using technology, thus has huge potential in intra city and inter city transportation, said Navin Honagudi, investment director, Kae Capital.
"Given the size and growing opportunities in the logistics marketplace, we see good growth for these start-ups," he said. He added five to six companies were in the space already and it could accommodate of eight to nine start-ups.
More firms are looking to raise funds. TruckMandi, an online truck booking solution start-up, founded by former Snapdeal employees Ankit Singh and Anurag Jain, is in talks with investors to raise $1-2 million expansion, strengthen its team and improve technology.
Singh says investors are active, as the importance of the logistics sector is being recognised. For an economy to grow, the sector needs to expand. Investors are bullish with the sector, which is poised to grow to $250 billion from the current $130 billion. "There will be many multi-billion online start-ups in India and the investors want to cash on these," said Singh.
According to Honagudi, the sector is small and can accommodate only eight or nine companies. He said it would see consolidation in the next three years. He added the platform would help both on the demand and supply side. An individual can book a truck for shifting house and on the demand side, single truck owners would also benefit.
Intra-city logistics aggregation has become a big business. The Karrier, Delhi-based Moovo and Mumbai-based The Porter provide intra-city truck services, which have raised money from investors.
TrucksFirst was founded in 2014 by IIT Kanpur alumnus and former McKinsey consultant Deepak Garg and Gazal Kalra, a Stanford and Harvard school graduate. Both the Founders were colleague at McKinsey.
The start-up offers logistics services meant for clients who need hassle-free, reliable, professional and super-express logistics services. By using simple processes, advanced technology, trained and professional staff, it helps clients manage long-haul logistics seamlessly.
Essentially, the start-up coordinates delivery trucks going between different cities, using technology and innovative operational processes. It aims to significantly improve the truck driver ecosystem and operational efficiencies while doing so.
