Rapido enters unicorn club with $120 million round led by WestBridge

Swiggy-backed bike taxi service startup Rapido has turned unicorn with a $120 million Series E funding round led by its largest backer, WestBridge Capital, which has put in capital through three different investment vehicles. A unicorn is a privately held startup company with a current valuation of $1 billion or more.

The board at Rapido has passed a special resolution to allot 10 equity shares, 95,479 Series E, and 95,489 Series E1 compulsory convertible preferred shares (CCPS) at an issue price of Rs 52,467 per share for a consideration of Rs 1,002 crore or $120 million, according to an Entrackr report, which has quoted the company’s regulatory filings with the Registrar of Companies.

WestBridge has invested the capital via Setu AIF Trust, Konark Trust, and MMPL Trust, according to the filings.

According to Entrackr’s estimates, the company raised the funding at a post-money valuation of Rs 8,517 crore or a little over $1 billion.

In April 2022, Rapido had raised $180 million in its latest Series D round. Led by new investor Swiggy, the round also saw investment from TVS Motor Company, along with existing investors, WestBridge, Shell Ventures, and Nexus Ventures, partaking in the fundraise. The company's valuation after the fundraise was $830 million.

Founded in 2015 by Aravind Sanka, Pavan Guntupalli, and SR Rishikesh, Rapido is an aggregator platform that provides bike-taxi and auto services in over 100 cities across India.

The company has raised a total funding of $329 million from investors, according to data platform Tracxn. WestBridge is the largest stakeholder in Rapido with a 25.6 per cent stake.

Food delivery firm Swiggy, which owns 15.1 per cent in the firm, has not participated in the new round. Bengaluru-based Swiggy has confidentially filed initial public offering (IPO) papers for Rs 10,400 crore (approximately $1.25 billion) and is likely to go public in a few weeks, according to sources.

Last year in December, Rapido, known for its budget-friendly bike-taxi services, announced its entry into the cab market, which is currently dominated by marquee brands Uber and Ola. Rapido’s cab foray is being enabled by a software as a service (SaaS)-based platform. BluSmart and InDrive are among the other names in the cab aggregator space.

Rapido had said that it is getting into cars with its zero-commission model for drivers. The Rapido Cabs platform had plans to onboard driver partners through a subscription model instead of levying commission on each ride—a model that the incumbents follow.

Till now, fintech firm Perfios and Bhavish Aggarwal’s artificial intelligence startup Krutrim have attained unicorn status. Lending firm Moneyview and fintech company Leap are about to raise a new round that is expected to turn them into unicorns.

Rapido is yet to disclose FY24 financials. The company’s operating revenue increased 3X to Rs 443 crore during FY23. The steep growth in scale also caused a 54 per cent spike in losses, which stood at Rs 675 crore in FY23, according to Entrackr.