Deal focus: BlackBuck in it for the long haul

BlackBuck, India's "Uber for long-haul truckers," has more than doubled its revenue every year since its Series C, which closed at $70 million in 2017. In that time, the number of India-wide locations being covered has increased 33% to about 400 and the number of trucks on the platform has tripled to 300,000. This set up a step-change in investor attention for the Series D.

Goldman Sachs and Accel Partners have led the latest round of $150 million with support from high-profile returnees like Sequoia Capital India and first-timers such as B Capital, the VC set up by Facebook co-founder Eduardo Saverin. The scaling success that attracted this turnout was made possible by tech-enabled business model diversification.

BlackBuck's core platform, which matches truck fleet operators with shippers such as merchants, is now only about 50% of the business following the launch of a separate platform focused on industry needs ranging from insurance to tires. The lion's share of the Series D will be channeled into technology build-outs for these two services, which are said to have already improved client revenues by up to 40%.

"Almost all the money we've raised to date has gone into product and technology development," says Supil Chachan, a director at BlackBuck. "That's because we have to find the best match between a truck and a load for long-haul movement from point A to point B, optimize return load for the same truck while maximizing the yield, market benchmarked pricing and best customer experience. That involves a lot of data, algorithms, and machine learning."

There are practical limitations to the digitization process of legacy industries, however, especially in fragmented, village-based industries dominated by older generations. BlackBuck plans to at double the size of its overall business within one year, but that won't be possible by just perfecting the app. Someone has to go door to door and convince skeptical trucking veterans to rethink their whole process.

BlackBuck has hired 700 people, out of a team of 2,000, to do this legwork, pitching the company's value proposition in 3,000 villages across the country. The early focus was on the south, then the eastern states, and now increasingly the more northern regions. But whether doubling down on existing geographies or entering new shipping corridors, the challenge remains the same.

"It's not easy to get fleet-owners to change behavior," Chachan says. "They have smart phones and use social media, but you wouldn't call them tech-savvy. Unlike the youth market, it really comes down to face-to-face interactions. But after four years of doing business, we're now able to highlight a lot of test-cases when explaining BlackBuck value propositions, and often, there's even a fleet-owner in the same village who will vouch for us."

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• Topics
• South Asia
• Expansion
• Technology
• India
• TMT
• Logistics
• Goldman Sachs
• Accel Partners
• Sequoia Capital
• B Capital