Hyperlocal Delivery Startup Dunzo raises $240 million in a funding round led by Reliance Retail

• ByTejika Bajaj     |    January 7, 2022

Bengaluru based hyperlocal delivery startup Dunzo has recently raised a funding round worth $240 million led by Mukesh Ambani’s Reliance Retail. Post this round, Reliance Retail will hold a 25.8% stake in the delivery startup. Existing investors such as Lightrock, 3L Capital and Alteria also participated in this round of funding, however Reliance brought in the bulk of cash at $200 million.

This announcement marks the entry of the conglomerate into the quick commerce segment amidst rising investor interest in the segment. With this round of funding, Reliance Retail has become the largest shareholder in Dunzo.

The company co-founder has revealed that partnering up with the largest retailer would allow the startup to ramp up its game against competitors. Both the companies intend to partner up and work extensively towards the supply chain management of the startup.

The entry of the conglomerate into the quick commerce segment comes at a time when many investments are being made into startups such as Blinkit, Zepto and Swiggy’s Instamart. Furthermore, various brand names such as BigBasket and Flipkart are also likely to foray into the market soon.

Dunzo has recently launched its own quick commerce services which has been facilitated by numerous dark stores. The deal between the two brands has doubled the valuation of the Bengaluru based startup to $775 million as against $300 million from the previous round of funding.

Talking about the recent round of funding, the co-founder and CEO of Dunzo, Kabir Biswas said, “Dunzo is planning an initial public offering (IPO) in the next three years and that both new and existing investors are aligned with the thought process. And while the Reliance deal has closed, it is in early stages of talks for a new funding round as well. The idea was to be able to work with a long-term partner on the business. We want to go ahead as an independent entity and be able to find a way to go public.”

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