Rapido Sets Sights on Unicorn Status, Launches ‘Rapido Cabs’

• ByStartupStory     |    December 6, 2023

In an interview with CNBC-TV18, Pavan Guntupalli, Co-founder of Indian ride-hailing service provider Rapido, expressed confidence in the startup’s trajectory towards becoming a unicorn in the coming months. Guntupalli shared, “Rapido is operationally profitable, we will soon become EBITDA profitable as well. Becoming a unicorn is just months down the line.”

Rapido, recognized for its bike and auto services, made a strategic move by expanding into the cab business with the launch of ‘Rapido Cabs.’ The service has been initiated in Delhi, Bengaluru, and Hyderabad, with plans for further expansion to additional states. The ambitious aim is to have 1 lakh cabs on the platform initially.

Addressing the competitive landscape dominated by Ola and Uber, Guntupalli acknowledged industry challenges, stating, “Currently the ride-hailing app industry is facing problems. Prices of the rides are increasing & earnings of the drivers are decreasing. For a mature category, these are not positive signs. Existing business models could be the root cause of this situation.”

In response, Rapido is introducing a unique SaaS-based model, departing from the commission-based structures employed by competitors. Guntupalli explained, “We’re launching a unique SaaS-based model. This is a zero-commission transparent model. We have transparent pricing for users. Hoping for drivers to join our platform who have left these platforms because of many issues. We’re hoping the market size will increase.”

Diverging from industry norms, Rapido plans to charge a subscription fee to its driver partners instead of a commission. Guntupalli emphasized, “Rapido has a unique position of being a low-cost player. Our mission is to provide economic solutions. Our cost structures are limited; we can sustain our business by charging just a subscription fee.”

Discussing the recent Delhi government scheme mandating electric vehicles (EVs) for ride-hailing platforms by 2030, Guntupalli clarified, “Rapido does not come under the aggregator policy because we’re a SaaS platform. We want to see roads getting cleaner & vehicles becoming sustainable. We’re looking forward to extensive partnerships in the next couple of years. Partnerships will be aimed at converting existing vehicles to electric & new EVs. We will majorly focus on trying to understand current problems for EVs.”

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