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If you were hoping this story would be about an on-demand economy gone so extreme that a company had picked up considerable venture capital for transporting passengers as in the photo below, I’m sorry to disappoint.
Jugnoo, which provides a platform for on-demand “auto rickshaws” (the modern-day form of the above), just raised $10 million in Series B funding led by Indian e-commerce company Paytm, with participation from Snow Leopard Ventures and Rocketship.vc. The company has raised $16 million to date.
While the news has been widely reported, I’ve reached out directly to the company to confirm the new funding and additional details about the round.
Originally founded in 2014, Jugnoo can basically be summed up as an “Uber for auto rickshaws,” a mode of transport common throughout India. Today, the company claims a user base over 120 million and employs 10,000 drivers across 30 cities and 11 villages.
Villages? Yes, villages, and Jugnoo’s ability to execute well not just in larger cities but also less populated areas is seen by the company as one of its distinct advantages. In spite of its new funding, Jugnoo has a long way to go before matching the $1.3 billion raised by Ola Cabs, an India-based ridesharing network valued at $5 billion. And that’s not to mention Ola’s chief competitor, Uber, which has raised billions of dollars at an even more astronomical valuations to win the Indian market.
But Jugnoo believes it has the advantage of its auto rickshaws being more versatile than traditional taxi vehicles (read: cars). In a Quora comment from a little over a year ago, Samar Singla (CEO and co-founder of Jugnoo) makes the case:
In India, over 45 million trips are being completed daily through auto rickshaws. The total number of autos in India is more than double the number of taxis. Plus the reach of taxis is limited to only few big cities, beyond which you would only find them in sparse numbers, making operations in such cities uneconomical. Autos, on the other hand, can be seen everywhere, be it a metropolitan city or a small town. Potential to scale Jugnoo is, therefore, manifold compared to Uber and the likes.
Furthermore, Jugnoo advertises that its rides will cost up to 32 percent less “compared to regular auto drives.”
I’ve reached out to Jugnoo to also gauge the company’s interest in becoming a logistics system for food delivery, as Uber has done with UberEATS and Ola tried (and failed) to do with Ola Café and Ola Store. Remaining focused on the core aspect of the service—picking up and dropping off passengers—could be another strength of the platform.
Jugnoo says it will use the funding to add more drivers to its platform and continue expanding across India.
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