Indian Delivery Startup Dunzo Nears $50M Funding Round Amid Tough Times for Startups
Dunzo in advanced talks for $50M funding round with existing investors Google and Reliance Retail.
31 March 2023
Dunzo, an Indian hyperlocal delivery startup, is in discussions to secure about $50 million in a new financing round.
Google and Reliance Retail, two existing backers of Dunzo, are among those discussing investment in the new round.
Delivery startups, including Dunzo, are finding it challenging to raise new financing rounds amid the globally weakening economy.
According to TechCrunch's Twitter post, Dunzo, an Indian hyperlocal delivery startup, is reportedly in advanced discussions to secure around $50 million in a new funding round. The Bengaluru-based startup is currently scrambling for comfort during a difficult funding winter for younger firms. Two existing investors, Google and Reliance Retail, are among those who are said to be discussing investment in the new round, which is largely moving ahead with existing backers, as per anonymous sources. The company has been looking to raise capital for several months and was aiming to secure at least $70 million and up to $150 million, according to the Indian newspaper Economic Times.
According to brokerage firm Bernstein, Dunzo is vying for a share of India's retail market, which is predicted to exceed $800 billion by 2025, along with competitors such as Swiggy's Instamart, Zepto (backed by YC Continuity), Tata-owned BigBasket, and Zomato's BlinkIt. However, delivery startups, typically among the most cash-guzzling businesses, are finding it challenging to raise new financing rounds in the current economic climate.
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The phenomenon is not restricted to India alone, with Europe's delivery market shrinking to a mere trio of companies, while Instacart's valuation plummeted from $39 billion to $10 billion since March 2021 . It's a global dynamic playing out amid a globally weakening economy. Kabeer Biswas, co-founder and CEO of Dunzo, declined to comment on the matter on Thursday. There has been no response yet from Google and Reliance Retail regarding the requests for comment.