SAN FRANCISCO (Diya TV) – Ford Motor Company has backed Zoomcar, India’s version of Zipcar, with a $24 million investment during the company’s Series B round funding, alongside the participation from returning investors Sequoia Capital, Nokia Growth Partners and Empire Angels.
Valuation of the company has not been disclosed, however, Zoomcar closed an $11 million Series B round last summer following an $8 million raise in late 2014. The four-year-old company is a car rental service based off the successful Zipcar model, which was bought by Avis for $500 million just three years ago. With this new round of funding, the company have received a total of $46 million in funding.
The startup is based in Bangalore and it currently claims to boast a rental car fleet of 2,000 cars to one of India’s tier-one cities, with 75 percent occupancy and 1.5 million app downloads. Ford was Zoomcar’s first OEM partner, and the startup said Ford provides “most” of the vehicles on its platform.
“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,” Ford Asia Pacific mobility director John Larsen said in a statement.
“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,” Larsen added.
Zoomcar has gregarious plans to grow its fleet of cars, and rapidly – the growth is centered around a marketplace the company launched this year called ZAP, or Zoomcar Associate Program. It’s a hybrid model that lets car owners and Zoomcar work together to make a vehicle available for lease via Zoomcar’s platform when it isn’t being used by its owner. This is a different method from the classic rental measures employed in other countries, such as by those who want to get to driving in iceland when abroad.
It’s essentially Airbnb for cars, however, it only applies to purchases of new vehicles, as the laws in India forbade sub-rental of existing cars.
As far as international expansion goes, that’s a topic on the table, but not one that is currently being discussed.
“India is quite an ocean,” Zoomcar cheif executive and co-founder Greg Moran said. “Although at at some point in the next 24 months [expansion] is in the cards for us.”
He mentioned markets such as Nigeria and other countries neighboring India in South Asia as potential expansion opportunities. These serve as areas where the company can tap into its expertise and business without language being a huge barrier.
“Those markets right now are really untapped,” he said. “Even if someone comes into the markets [now], we will have a huge advantage based on our business… [such as] data on users, historical driving behavior, payments and all these elements that put this whole piece together.”
In the immediate, Moran is most focused on growing Zoomcar’s business and presence in India. Unlike rivals like ride-hailing service like Ola – which is closing in on 100 cities, and includes long-distance ride services – Zoomcar is deliberately moving slower with an “efficient growth” plan.
“We will continue to go much deeper,” he explained. “Others have blasted out to 100-plus cities and kept very a horizontal strategy, but with around 80 percent of revenue coming from five or six cities, it derails them from profitability.”