Ford leads $24m round for VC-backed India car rental start-up

Founded in 2013, Zoomcar provides self-drive car rental services in seven cities, with a fleet of nearly 2,000 automobiles ranging from hatchbacks to SUVs. The company's app - a replacement for traditional service staff that processes bookings and license checks and also enables mobile activation of rentals - has been downloaded 1.5 million times. Users have traveled more than 120 million kilometers to over 50,000 destinations.

The new capital will go towards the company's car-sharing marketplace - the Zoomcar Associate Program (ZAP) - which allows individuals to purchase vehicles on behalf of Zoomcar, list them for rent on the platform, and earn a share of the monthly rental fees. The ZAP user base is tripling month-on-month following its introduction earlier this year, according to a statement. Zoomcar expects the marketplace model to account for more than 75% of its overall vehicle inventory by early 2017. As a result, fleet size will exceed 25,000 across over 25 cities by 2018.

Ford has been the company's largest supplier of vehicles and the groups have worked closely on a number of mobility experiments. The US automaker is said to be investing through its Ford Smart Mobility unit, a new subsidiary formed to design, build, grow and invest in emerging mobility services.

"As Ford expands its business to be both an auto and mobility company, we are pursuing a long-term vision to develop services and solutions that make it easier for consumers to move through cities using multiple modes of transportation," said John Larsen, mobility director for Ford Asia Pacific. "Our investment in Zoomcar will help strengthen the company's role in shaping India's developing mobility space and provide new transportation options to help make people's lives better."

AVCJ Research's records show that Zoomcar has now received close to $50 million in funding. There were three seed rounds involving Basset Investment Group, Empire Angels, Funds Club and Sequoia between February 2013 and May 2015. NGP then joined Empire and Sequoia in an $11 million round announced in July of last year. Zoomcar has also received funding from InnoVen Capital.

Investment in India's technology-abled transportation market has largely focused on ride-hailing and taxi services. Last year, dominant ride-hailing player Ola completed a Series F round of funding led by Baillie Gifford, raising $500 million at a reported valuation of around $5 billion. Ola acquired TaxiForSure, a VC-backed rival in 2014.

Meanwhile, Meru Cabs, which has been backed by India Value Fund Advisors since 2006, secured $22 million from Brand Capital in June.

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• Topics
• South Asia
• Technology
• Expansion
• TMT
• Venture
• India
• Transportation
• Sequoia Capital