Reliance Industries Ltd’s retail arm has acquired a 25.8 percent stake in Google-backed hyperlocal delivery startup Dunzo, extending billionaire Mukesh Ambani’s presence in the fast-growing grocery delivery market.
Reliance Retail has made a $200 million investment in Dunzo as part of a $240 million funding round in the Bengaluru-based company. Existing investors Lightbox, Lightrock, 3L Capital, and Alteria Capital joined the round as well.
In a statement issued on Thursday, Dunzo stated that it intends to use the new capital to accelerate instant delivery of essentials from a network of micro warehouses, as well as to expand its business-to-business (B2B) vertical to enable logistics for local merchants across Indian cities.
Mint previously reported on Reliance’s plans to back Dunzo alongside other existing investors in October. Certain business partnerships and funding will also be framed by Dunzo and Reliance Retail. Dunzo will enable hyperlocal logistics for Reliance Retail’s retail outlets, further strengthening the company’s omnichannel capabilities. According to the statement, Dunzo will also assist Reliance’s JioMart’s merchant network with last-mile delivery.
“With this investment from Reliance Retail, we will have a long-term partner with whom we can accelerate growth and redefine how Indians shop for daily and weekly essentials. We’re excited by the traction and velocity that Dunzo Daily has achieved,” said Kabeer Biswas, CEO and co-founder of Dunzo.
The additional funds will be used to expand Dunzo’s rapid commerce operations to 15 cities from the current seven. Dunzo also debuted its quick delivery service, ‘Dunzo Daily,’ in Bengaluru last year, which is recording a weekly growth rate of more than 20%. It claims to offer daily and weekly necessities within 15-20 minutes.
“We are seeing a shift in consumption patterns to online and have been highly impressed with how Dunzo has disrupted the space. Dunzo is the pioneer of quick commerce in India, and we want to support them in furthering their ambitions of becoming a prominent local commerce enabler,” said Isha Ambani, director, Reliance Retail Ventures Ltd.
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