Logistics marketplace LetsTransport looks to enter 20 more cities by 2021

The company has raised $20 million in three rounds of funding

Logistics strategies not only promote positive results but also create value for customers. In India, the logistics sector is sprawling and plagued by multiple inefficiencies, leading to cost overrun and customer dissatisfaction. Intra-city logistics are no exceptions to the problems. 

Bengaluru-based LetsTransport, a tech-enabled logistics marketplace for intra-city deliveries, seeks to address these issues. Co-founded in April 2015 by Pushkar Singh, Sudarshan Ravi and Ankit Parasher, the company has raised Rs 100 crore from Bertelsmann India Investments, Fosun International and other investors.

“Pushkar and his team bring in a rare combination of deep sector expertise, great industry solutions and high entrepreneurial energy. By leveraging technology to solve for fragmentation on the supply side, coupled with strong unit economics, we believe the company is strategically placed to capture the pole position in the market,” said Pankaj Makkar, managing director, Bertelsmann India Investments.

The company has, so far, raised $20 million in three rounds of funding. Its investors also include Rebright Partners, NB Ventures, GMO Venture Partners and Mitsui Sumitomo Insurance Venture Capital.

Concept

Owing to the fragmented nature of the mini trucks industry in India, intra-city logistics are twice as expensive as other advanced economies for the client. On the other hand, the truck driver community remains one of the most economically backward. This gap is attributed to inefficiencies in the existing ecosystem. 

LetsTransport’s marketplace aggregates mini truck owners to bring in operational efficiencies for intra-city needs. The company claims its multi-modal network of trucks clubbed with proprietary technology, built from the team’s experience in supply chain, increases utilisation, resulting in higher earnings for owners and a “25 per cent” reduction in distribution cost for clients.

“Our clients enjoy an average success rate of 99 per cent in within-city logistics. Our platform helps them with better product availability in the market, thereby enhancing their sales,” said Pushkar, co-founder and chief executive officer of the tech start-up.

Similarly, the income of mini truck drivers using the company’s platform has recorded about 40 per cent rise, he claimed.

“The platform offers one of the most reliable and elastic distribution networks that is trusted by marquee clients such as Coca-Cola, Amazon, bigbazaar, etc,” he said, adding the company has over 20,000 truckers on its platform in seven cities — Bengaluru, Delhi, Chennai, Mumbai, Hyderabad, Pune and Vijayawada — and it is “India’s largest aggregator of mini trucks”.

Co-founders Sudarshan Ravi, Pushkar Singh and Ankit Parasher

Opportunities 

LetsTransport works with four large industry verticals — consumer goods, e-commerce, organised retail and logistics and distribution companies. “We are a multi-industry platform,” said the co-founder on the company’s USP. The founders said $30 billion is spent annually in intra-city logistics in the country.

The start-up plans expand to 20 more cities by 2021 and have about 2 lakh mini trucks using its platform by 2020. LetsTransport aims to break even in next 18 to 24 months. It targets aims to close this financial year with Rs 100 crore in revenues.

It competes with firms like Blowhorn, Porter and Smartshift and claims to be the market leader in the enterprise segment.

“We charge a commission from both clients and drivers for every successful transaction. We have been gross profitable for the last two years,” Pushkar said.

The company will utilise the latest fund infusion to strengthen technology, add new industry verticals to lock in marquee clients, and scale up the company’s operations. Pharmaceutical and cement industries are two verticals on its radar.

Existing inefficient processes and mindset, low technology adaptation in the industry and working capital are the challenges identified by the company.

FACTBOX

Founded: 2015

Area of business: Logistics 

Funding: $20 million in three rounds

Investors: Bertelsmann India Investments, Fosun International, Rebright Partners, 

NB Ventures, GMO Venture Partners and Mitsui Sumitomo Insurance Venture Capital and others

USP:  A multi-industry platform with over 20,000 truckers in seven cities

Expert Take: Intra-city logistics ripe for tech-led disruption

Ravi Kaushik, Partner, WaterBridge Ventures

When I first met the founders of LetsTransport, I was struck by how remarkably clear the they were with their vision and value proposition. This (intra-city logistics) is a highly fragmented market with no organised player, which continues to be a pain point for enterprises as it requires technological and operational expertise to meet SLAs (service level agreements). The segment is ripe for a technology-led disruption. LetsTransport is in the right place to create a valuable network not just for scheduled deliveries but also build enough elasticity in the network to cater to peaks and troughs. By signing up enterprises, the team has ensured demand while building in inherent network effects for supply aggregation. This is an execution heavy business and a tough space to win, so a fund raise is definitely a great step in a long journey ahead. As the company scales, the key would be to build a high-quality team with excellent credentials that has an unmatched on-ground execution capability.