Bike taxi operator Rapido is currently in talks with investors for its next round of fundraising. Reports suggest the Chinese technology major Xiaomi may take an interest and make an investment in the startup.
The positive development from the side of Rapido is that it has been progressing very fast and its valuation has now crossed $300 million and may touch $350 million even. This would enable it to stretch this funding to $100 million even. To place this in perspective, the company had raised it last funding of $55 million on a valuation of $150 million. The valuation has doubled in the interim. The reasons for this are not far to seek. Rapido has been able to scale up its operations. It is now present in 80-90 cities in India offering over 5 million rides per day. This figure stood at just 2.2 million rides per day just six months before.
Xiaomi’s founder Lei Jun has floated an investment arm Shunwei Capital and it is possible the investment in Rapido may be picked up by both Xiaomi and Shunwei. There is no official confirmation on this development either from Xiaomi or from Rapido.
There is also the possibility that some of the existing investors in the venture, that include Westbridge Capital, BAce Capital and Nexus Venture Partners may also pick up their share of the investment in this round as it normally happens with startups that are doing well. Pawan Munjal of Hero MotocCorp has made an investment in Rapido as well.
On the financial side, Rapido has not started making profits but it is well on its way to becoming profitable, according to observers.
Offering ride on its bikes at ₹10-11 per kilometre, Rapido is relying on the huge 210 million two-wheeler licence-holding people in the country to patronise its bike taxi hiring business. The company is trying to expand into the interior markets in the country where it sees more potential for its business.