India’s many leading start-ups turned into unicorns owing to their unique, out of the box and convenient services. Delhivery, is one such example of a successful Indian unicorn which is one of the e-commerce start-ups that transformed delivery services in the country. Delhivery valued at $1.5 billion and raised $413 million when it became a unicorn in the year 2019. It is a logistics start-up that focuses on the e-commerce segment mainly.
Delhivery, is a Gurugram based Indian logistics and supply chain company. It is among the first e-commerce delivery companies in India that offers a range of services which includes parcel transportation, cross border and technology services, freight, and fulfilment services. In 2011 it was founded by Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan, and Kapil Bharati. It was initially known as SSN Logistics Ltd. For the first few months it was conceptualised as a hyperlocal express delivery service provider for delivering flowers and food locally in the city for offline stores.
Organization
CEO of Delhivery is its Founder member Sahil Barua and Co-Founder Kapil Bharati is the CTO of Delhivery. Sandeep Barasia, was appointed as Chief Business Officer in December 2018, who is in charge of the P&L across the parcel, warehousing, and freight divisions. Ajith Pai, who was the CFO then, took over the role of COO where he is in charge of the operations, engineering, HR, and finance of the company. Amit Agarwal (an IIT-Kanpur alumnus) who was earlier the vice president-finance at Delhivery, took over the role of CFO.
Delhivery: Startup to IPO
Delhivery began as a logistics start-up and food delivery business, serving a core customer base in India’s sprawling capital, Delhi – as its name suggests – and now boasts being the country’s biggest independent e-commerce logistics start-up.
Launched in May 2011, by the end of the year it had 150 employees, delivering around 500 shipments a day, and began serving ecommerce companies in Delhi NCR. By 2016 it celebrated a major milestone in delivering its 100-millionth shipment. They provided supply chain solutions to a diverse base of over 23600 active customers such as e-commerce marketplaces, direct-to-consumer e-tailers and enterprises and SMEs across several verticals such as FMCG, consumer durables, consumer electronics, lifestyle, retail, automotive and manufacturing. The following year it expanded its team to 15,000 people and domestic reach to 1,200 cities. Today Delhivery claims to have a pan-Indian reach, serve 10,000 customers, and has delivered one billion packages. It has more than 40,000 team members and reach across more than 2,300 cities giving it the ability to deliver one million packages a day, round the clock.
They achieved this feet through high-quality logistics infrastructure and network engineering, a vast network of domestic and global partners and significant investments in automation, all of which are orchestrated by their self-developed logistics operating system that drive network synergies within and across services and enhance their value proposition to customers.
Delhivery’s extends its transportation network to geographies which are currently not serviced by Delhivery internal operations through Constellation partners. The Partners take advantage of their local knowledge and autonomously offer express parcel, part-truckload freight and cross-border express and freight services to SME and retail customers in their catchment areas, backed by their full nationwide network, service precision and cost efficiency. Delhivery through its constellation program has over 1200 delivery centres operated by partners.
Delhivery Business Model
The Delhivery business model is a B2B model, where they provide services that are primarily focused on business people, where the businesses are charged, and the customers are charged nothing.
The services that the company offers consists of three verticals, namely- warehousing, transportation, and commerce, although the majority of their business is focused on transportation. They obey a ‘plug and play’ model and provides a solution to all those customers who want to send out their products to their respective customers.
The services offered by Delhivery include last-mile delivery, transit, and third-party warehousing, reverse logistics, vendor to warehouse and vendor to customer, payment collection, shipping, etc. The company follows a distribution model, where every branch of the company is operated as a hub. Hence, the parcels can be distributed to the customers without any problems.
They follow a process known as the first-mile operation in which whenever a product is ordered online, it is picked up from the manufacturer and is sent to a processing unit, where it gets sorted for the destination city. Thereafter, a line haul is used to transport the products from the processing units to the destination cities. In the last mile operation, the product gets delivered from the delivery system to the customer’s house.
Fund Raising
In March 2019, Delhivery raised its biggest round of funding with a $413 million investment from Japanese telecom and internet major SoftBank. Further in May 2021, it raised $277 million in a funding round led by US investment firm Fidelity, raising its market valuation to nearly $3 billion.
Delhivery acquired the B2B logistics company, Spoton Logistics, for ₹1,600 crore (US$200 million) in August 2021. Recently, in December 2021, it acquired California-based unmanned aircraft system company Transition Robotics Inc.
In May 2022, Delhivery raised ₹2,347 crore (US$290 million) of funding from 64 anchor investors ahead of its initial public offering and later launched its initial public offering (IPO) of ₹5,235 crore (US$660 million) at a valuation of ₹35,283 crore (US$4.4 billion) and got listed on the BSE and NSE
Investors
The largest stakeholders in the company as on November 2021, were Nexus Venture Partners (9.23%) and SoftBank Group (22.78%). Other investors with over 5% stake include Tiger Global, The Carlyle Group, CPP Investment Board, and Times Internet.
Financials
Until December 2021, Delhivery raised about US$1.4 billion from its investors across 13 private fundraising rounds.
The country’s largest fully-integrated logistics provider grew revenue by 63 percent year on year basis to Rs. 7,241 crore in FY22, from Rs. 4,450 crore the previous year. From 3,647 crore in FY21 to 6,882 crore in FY22, where revenue climbed by 89 percent. A number of factors have contributed towards this success.
Awards
Delhivery got the prestigious Startup of the Year award at ET Startup Awards 2019. They received high praise for touching remote corners of the country, encompassing more than 17,000 pin codes and creating impact by being a full-stack logistics platform. They also bagged the Mahindra Transport Excellence Award in 2018 and Young Turk Star -up of the year award in 2016.
JIMS, Kalkaji
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