The process of purchasing a automobile, even though painstaking, has a sweet reward on the quit. The infant-like anticipation that builds up as one waits to take delivery of their new vehicle can only be matched by using the joys of lengthy drives with friends and own family. That pleasure makes all the studies and making plans earlier than purchasing a car well worth it. And that’s in all likelihood why inside the minds of clients, the automobile condominium market is drab and uninnovative.
Unfortunately, this euphoria changed into ephemeral for entrepreneur Ashwarya Singh and his two flatmates who sold a car by pooling in their financial savings and securing a automobile mortgage. Just underneath a month of purchasing it, their present day car met with a horrible coincidence and was damaged past restore. To make matters worse, the insurance agency declined to cowl the damages as the opposite party did now not have legitimate vehicle insurance. That’s whilst a sad reality dawned on them; even though the auto was long gone, they might need to preserve paying the EMI for the next 3 years.
As they contemplated their plight, in addition they realised that none of them virtually used the auto drastically and it typically stayed within the parking spot. Plus the struggles of owning and preserving a vehicle in a city like Mumbai some distance handed its utility quotient.
That’s when Singh started out mulling the concept of methods in which Indians ought to use a car without proudly owning it. He believed that India had the right conditions to create a thriving vehicle rental marketplace, and commenced running on a venture that could provide customers the joy of owning a car, with out all of the fuss concerned. He speedy roped in his university buddies Hemant Kumar Sah, Amit Sahu, and Vasant Verma to launch JustRide.
It took a 12 months of cautious deliberation earlier than JustRide took off in Powai, Mumbai. Shortly after, the team added in Abhishek Mahajan, who became running with PwC India, as a cofounder. To start with, they leased a fleet of 8 vehicles from a corporation in Delhi. Then in 2017, the corporation rebranded to Drivezy and pivoted from being an aggregator to see-to-peer automobile and bike sharing marketplace.
The A To Z Of Drivezy
Founded in August 2015, Drivezy gives a platform that caters to clients at both ends of the spectrum i.E. Automobile owners and ride-seekers. Ride-seekers can lease automobiles, motorcycles and scooters on a self-pressure foundation. The owners listing their automobiles on Drivezy’s platform and clients can pick out the car and a suitable apartment plan as in line with their want.
From proprietors, Drivezy micro-leases motors and rents them to seekers, thereby supporting proprietors earn some cash. This platform is known as JustConnect and proprietors can music their income and prices in actual-time the usage of the JustConnect app. However, as consistent with the rent settlement, proprietors have to list their cars with JustConnect for at least three years.
While it began with 4-wheeler rentals, sensing the growing call for for two-wheelers from its clients, in 2017, Drivezy added bikes and scooters as nicely. According to Singh, this proved to be a wonderful move for the agency as the service witnessed an incredible surge in call for.
Drivezy has also launched weekly and month-to-month subscription plans to satisfy this demand and maintain clients. This provider has won reputation among students, young professionals, and transport executives, Singh stated. In Hyderabad, drivers of motorbike-taxi structures like Ola and Rapido are renting two-wheelers from Drivezy’s platform and the usage of them as a method to earn cash.
To open up micromobility sales, Drivezy piloted a ‘final-mile’ condo provider in collaboration with Hyderabad Metro Rail Limited, in which it rents out motorcycles to metro passengers on a pay-by using-the-minute foundation. It plans to launch a similar service in Nagpur, with a fleet of electric motors exclusively.
In addition to character proprietors, the organisation has collaborated with car dealerships to listing unsold inventory. The organisation has also partnered with greater than 25 banks and NBFCs to offer automobile loans to folks who desire to purchase new motors and list them with Drivezy.
Chauffeuring A Bumpy Ride
To make sure passenger safety and security of vehicles, Drivezy limits speeds of its motors to 80 kmph. With on-board diagnostics, GPS trackers, and engine immobilizers, the organisation can remotely kill car ignition inside the occasion of a theft. Drivezy’s motors also include bumper-to-bumper 0 depreciation coverage cowl, to cowl costs incurred from injuries or collisions.
As with almost all younger startups, Drivezy too needed to face its honest percentage of barriers during its initial days. In the early days, the organisation could not manage to pay for third-birthday celebration roadside help and in the event of an coincidence, the cofounders might retrieve the cars and deal with the paperwork themselves.
The early loss of two cars because of accidents impacted the younger startup dearly. In order to make up for the losses and hold the corporation afloat till seed funding, Drivezy began a chauffeur-driven car condominium carrier for the subsequent six months. “Since we had a fleet of luxury motors, the margins had been quite high. This pilot helped us stay afloat for pretty some time,” stated Singh.
Today, to ensure well timed servicing and everyday maintenance of all indexed motors, Drivezy has set up a community of multi-emblem service centres.
The State Of India’s Car Rental Market
The car apartment space is developing in India at a miles quicker tempo than many thought, and considered one of the biggest elements has been the converting consumer behaviour on the subject of mobility and car possession. With the rise of journey-hailing services which include Ola and Uber, customers are gravitating towards taxis for mobility as opposed to private cars.
Coupled with the fact that car possession is falling, it’s no surprise that automobile apartment is a hot area in India. On a 12 months-on-yr foundation, the general passenger automobile sales declined through 17% to 2,forty five,599 gadgets in April 2019 as compared to 2,ninety six,369 devices in April 2018, in line with a document by using the Society of Indian Automobile Manufacturers (SIAM).
Plus there’s uncertainty in the car marketplace with the emergence of electric automobiles, with its allied authorities incentives. Given this case, it’s now not surprising that the car condo marketplace is developing faster than ever before.
“There is not any doubt that automobile sharing has a large marketplace in India. The region is growing geometrically each 12 months and for this reason, opposition is continuously growing,” Singh said.
According to a report via Ken Research, the Indian vehicle rental marketplace is projected to touch $12.5 Bn through 2019, growing at a CAGR of 35%. This might be attributed to motives which include a spike in lengthy-remote street-trips, new era for car condominium gamers, growing fleet sizes, deeper geographical penetration and entry of recent players.
Drivezy competes with taxi aggregators and ridesharing startups like Ola, Uber, Bounce, LetsRide, PoolCircle, ZoomCar, Carzonrent, Wunder, and Ryde among others.
According to Singh, the truth that Drivezy is the simplest platform that features each motorcycles and automobiles is one of the predominant differentiators. He additionally claimed that the business enterprise’s asset-mild business version and massive supply chain allows them live ahead of the competition.
Subscription-based ownership is a quick-catching fashion in India and can trade the automobile-possession landscape inside the usa further. According to a Technavio file, the global automotive subscription services marketplace size will grow by using $1,737 Mn in the course of until 2022. Even car producers have noticed this shift in patron-buying behaviour and have equipped for it. Indian car large Mahindra & Mahindra has entered the vehicle leasing section through partnering with two car-leasing organizations, Orix and ALD Automotive.
Earlier this yr, Toyota Motor Corporation mounted a brand new company known as Kinto to manage and operate its vehicle subscription carrier in Japan.
According to reports, even Ola is exploring a subscription-primarily based version for its self-drive or vehicle condo presenting. CFT had suggested that Ola is planning to release the carrier in seven towns by means of deploying over 10,000 motors along with luxury sedans and SUVs under the ‘Ola Self-Drive’ class.
“As automobile sharing services diversify in addition, we will witness the rise of state-of-the-art transportation structures a good way to trade the manner we purchase, use and promote vehicles. I am happy that Drivezy is playing an lively function in this paradigm shift.” – Ashwarya Singh, Drivezy cofounder
Crossing Milestones And Gaining Mileage
Leading this shift is Drivezy’s community of 5K owners, fleet operators and car dealerships. The corporation has witnessed most traction in Bengaluru, accompanied via Hyderabad and Pune. Drivezy claims to have a purchaser base of approximately 1.5 million registered users and with around ninety three% of them coming from the 18-35 age bracket. The organization claims to have processed over 4 lakh bookings, and has 500 employees in eleven cities.
The growth of Drivezy may be attributed to its constant revenue stream and the finances raised. The agency earns a fifteen-30% commission for every successful transaction. Last yr, it clocked a GMV (Gross Merchandising Value) of $32 Mn, developing by 2 hundred% because 2017. It’s targeting a GMV of $eighty Mn this year.
In phrases of investment, the organisation has raised a total of $32 Mn in equity financing from traders inclusive of Das Capital, Axan Partners, IT-Farm, Yamaha Motor Ventures, and Y Combinator, amongst others.
Last 12 months, Drivezy additionally secured $100 Mn in an asset financing address which the company plans to induct close to 50,000 cars. The employer additionally raised $20 Mn in Series B fairness funding, led through present investor Das Capital. “Right now, we are raising $one hundred Mn as part of our Series C fundraise. We also are elevating another $400 Mn in asset financing,” stated Singh.
Last 12 months, Drivezy was diagnosed as one of the 42 most progressive Indian startups of 2018 by CFT’s 42Next listing. It became considered one of 3 Indian startups decided on via Y Combinator for its Summer 2016 batch. As part of this 3-month program, the accelerator invested $120K in the startup for a 7% equity stake. In 2015, the startup changed into selected by way of Google for the Launchpad Accelerator programme.
The Road Ahead
Thanks to its revenue and funding records, Drivezy is in prime function to extend in India. It plans to enlarge its presence to 21 Indian cities and enlist close to 70K cars onto its platform. Besides its India plans, the employer desires to release in the US, beginning with a fleet of two hundred vehicles in San Francisco. It’s additionally making plans expansion in Southeast Asia.
Drivezy is likewise planning to execute some big partnerships with the ridesharing and price range lodge sectors. Talking about his organization’s partnership endeavours this 12 months, Singh stated that it plans to collaborate with NBFCs (Non-Banking Financial Companies) so one can enlist their repossessed automobiles on Drivezy’s platform.
“Our enterprise is going through a riveting section. Thanks to the meteoric upward push of IoT and internet connectivity in Indian cities, we've the method of fostering an urban shuttle infrastructure that is based totally at the concepts of collaborative consumption.”