Hyperlocal and last-mile delivery service provider Zypp, which uses only electric vehicles to deliver products, has received a commitment of Rs 35 crore from domestic and foreign investors and is in talks with more investors to take the total funding to Rs 60 crore, a senior executive told Moneycontrol.
"The commitment for Rs 30-35 crore has already come. We have an integrated term sheet," Zypp's Founder and Chief Executive Officer Akash Gupta told Moneycontrol in an interaction.
The deal is likely to close in the next couple of months and the company will be utilising the funds to expand its services to newer geographies and improve the support infrastructure.
Zypp, formerly known as Mobycy, was founded in 2017 by Gupta and Rashi Agarwal as a startup providing electric scooters on rent to customers. It pivoted from B2C to B2B in November 2019. While Gupta is the former vice president of marketing of fin-tech firm Mobikwik, Agarwal has worked as a senior research associate at S&P Capital IQ in the past.
The company targets to transform last-mile deliveries from petrol to electric with their expertise in EV technology and tech-enabled operations on the ground.
It currently has over 1,000 electric vehicles across Delhi, Gurgaon, Noida, Ghaziabad and Jaipur. It plans to expand to 10,000 vehicles across 20 cities by 2021.
It last raised a Pre-Series A funding of $2.8 million from IAN Fund in 2019.
Zypp has tied up with original equipment manufacturers like Hero Electric and Lohia Auto to procure the vehicles. However, instead of buying them upfront, it gets these vehicles funded by high net worth individuals whom it pays a monthly rental for about three years after which it owns the vehicles.
It has partnered with over 30 B2B clients including BigBasket, Spencer’s, Amazon, Flipkart, Licious and Myntra among others to serve their last-mile deliveries.
In India, electric two-wheeler penetration is expected to reach 25-35 percent by 2030, according to a report by KPMG.
The running cost of electric vehicles is a fraction of the cost incurred to operate an IC-engine vehicle, which makes it a strong case for adoption by the industry at large.
According to Gupta, as compared to Rs 5,000 required for fuel and maintenance of a regular bike, electric vehicle costs just Rs 100. This brings down the average cost of deliveries also massively.
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