Chinese venture capital fund Fosun RZ Capital, and Stellaris Venture Partners, that’s investing out of its two-year-old USD 100 million maiden fund, has led an undisclosed amount of seed funding in Loca, a Bengaluru-based last-mile cab connectivity operator, which launched it service in April 2019, local media Mint reported.
Quoting a person close to the development, the report puts the investment to be at around USD 5 million.
A few other angel investors such as Aprameya Radhakrishna, co-founder of now defunct TaxiForSure, Mayank Bidawatka, co-founder of peer-to-peer knowledge sharing startup Vokal, and Rohit MA, co-founder of hospital chain Cloud Nine Hospitals, also participated in the investment round.
Operating out of four metro stations in Bengaluru, the company plans to use the funds to expand its services to all the major metro stations in the city, ramp up its technology development, and scale up the operations team. It is also looking at entering other cities, beginning with New Delhi in early 2020.
Founded by Gautam Patil and Krishnakumar Ramachandran, Loca offers last-mile connectivity using a mixed fleet of minivans and cars, which metro commuters can book in real-time. The company claims, its over 5,000 users book cabs and hail it within 2.5 minutes of reservation on its platform.
“We spent many months building the dynamic routing algorithm and the initial results are very encouraging,” Patil told a local technology media website YourStory. The company said it launched its service in April this year after running over nine months of field trials, just to fine-tune its algorithm.
According to the cab operator, the motorized micro-mobility market in India has the potential of 100 million trips per day which has not yet been fully optimized.
“We view micro-mobility transit as a massive and largely unsolved problem in almost all cities in India. In China, we have witnessed new-age micro-mobility solutions being adopted by citizens at a rapid pace with millions of rides being taken daily. Fosun’s portfolio company Hellobike has shown significant scale and adoption, and we believe Loca can be at the forefront in India,” Tej Kapoor, co-executive president of Fosun RZ Capital told Mint.
Last-mile connectivity remains a challenge in India, which ride-hailing startups such as Rapido, Vogo, Bounce, and Yulu, among others are trying to solve. Delhi Metro Rail Corporation recently partnered with Yulu to provide electric bikes at nine metro stations.