Indian logistics firm Delhivery has attracted another high-profile investor ahead of its expected IPO in the next two quarters: the addition of Lee Fixel.
The Gurgaon-headquartered firm has disclosed in a regulatory filing that Addition has invested $76.4 million in the startup. According to filings provided by market intelligence firm Toffler, the new investment is part of a Series I round. Till now, Delhivery has disclosed the investment of only Edition.
The 10-year-old startup started its life as a food delivery firm but has since moved to a full suite of logistics services in over 2,300 Indian cities and over 17,500 ZIP codes. It is one of a handful of startups attempting to digitize the logistics market demand and supply system through a freight exchange platform.
The new investment comes months after a subsidiary of FedEx made a $100 million investment in Delhivery, and the startup separately closed a $277 million funding round. The startup had said earlier this year that it wanted to file for an IPO within the next six to nine months.
Delhivery is one of the largest logistics firms in India. Its platform connects freighters, agents and truck drivers offering road transport solutions. The startup says the platform reduces the role of brokers, makes some of its assets such as trucking – the most popular transport mode for Delhi – more efficient, and ensures round-the-clock operations.
This digitization is crucial to address the inefficiencies in the Indian logistics industry, which have plagued the national economy for a long time. In a report on India’s logistics market last month, Bernstein analysts wrote that poor planning and demand and supply forecasting lead to increased costs, theft, losses and delays.
Delhivery, which says it has placed over 1 billion orders, works with “all of India’s largest e-commerce companies and major enterprises,” according to its website, where it also says the startup has placed more than 10,000 Have worked with more clients. For the final stage of delivery, its couriers are assigned an area that never exceeds 2 square kilometres, allowing them to run multiple deliveries in a day to save time.
The TAM (total addressable market) of the Indian logistics market is more than $200 billion, Bernstein analysts wrote in a report to customers earlier this year. The startup said late last year that it was planning to invest more than $40 million within two years to scale up and increase the size of its fleet to meet growing demand for orders as the pandemic slows. Meanwhile more people shop online.
Lee Fixel, a well-known name in the Indian startup ecosystem, is one of the first global investment partners to see potential in India. His initial investment in Flipkart over the past decade through Tiger Global has accelerated the pace at which the startup ecosystem in the world’s second largest internet market has developed.
Addition, Fixcel, a venture firm founded last year, has already begun to focus on India, where it has also backed the public social network and Neobank Jupiter.
Fixel also continues to write individual checks to Indian startups. According to two people familiar with the matter, he is currently in talks to support Bangalore-based coffee chain Third Wave.