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Wednesday, February 28, 2024

Meet the father & son who built Rs 120 crore tech-driven, on-demand private driver service

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In 2015, a father and his son, Ashok and Rahm Shastry, founded DriveU, a technology-driven, on-demand, and economical private driver service.

Ashok. says, “We saw a huge opportunity to improve both the driver and passenger experience if we could provide transparent pricing, assured safety, uniformity, and scale via technology.”

The automobile drivers’ aggregator platform DriveU super app released in 2021 to offer doorstep car wash, car servicing, FASTag recharge, and insurance renewals.

The platform has over 65,000 background-verified drivers across Delhi-NCR, Mumbai, Bengaluru, Hyderabad, Chennai, Ahmedabad, Kolkata, Pune, and Coimbatore.

Bengaluru-based DriveU plans to introduce DriveU+, a premium driver service with experienced and vetted drivers, after tripling growth in FY23 and obtaining three rounds of investment. Investors are also discussing its next fundraising round.

Ashok adds, “We want to raise $10 million in equity and debt to accelerate product development and exponential growth. We are EBITDA+ and cashflow breakeven, but our main goal is to expand our vehicle ownership services regionally and our core driver service offering in our cities. To accelerate expansion, we’re in talks to secure a large capital round.”

Humble Mobile Solutions Pvt. Ltd.-owned DriveU wants to double its income to Rs 120 crore from Rs 61 crore in FY23 without extra capital.

The startup’s GMV rose 126% to Rs 60.9 crore in FY23 from Rs 27 crore in FY22.
Marketing to B2B and B2C

DriveU’s main product is B2C and B2B driving services. B2C users can rent hourly or daily drivers. B2B companies employ DriveU’s on-demand drivers instead of fixed, expensive drivers.

Ashok Shastry adds, “We have prominent clients in used car platforms, OEM service stations, and several insurance companies who use our service to improve their operations and finance.”

Valet parking is available to B2B clients from the startup.

He says, “We just started this vertical. We now have two pubs, Arbor Brewing Company and The Bier Library, but more will open in a few weeks. DriveU valet tags, standees, and special deals for pub guests encourage safe consumption at more than 60 upscale pubs in Bengaluru and Hyderabad.
What it provides

DriveU verifies drivers’ criminal, court, driver’s license, and residence before hiring them. The co-founders argue this distinguishes it from EziDrive, HOP, and Drivers4Hire.

“Beyond the quality of drivers we provide, we have built a robust tech-stack to ensure driver timeliness, fitness to drive a car, an intuitive app to request a driver in seconds, safety services where we track drivers throughout the trip, and online or cash payment for the service,” says Ashok.

DriveU offers optional trip insurance to cover minor automobile damage, 24×7 driver service (most only operate from morning to evening), and live customer assistance.

The firm also enables B2C consumers earn DriveU coins to spend for doorstep car wash, auto servicing, and insurance renewals through the app.

DriveU has made almost five million journeys, says Ashok. The app has 650,000 direct clients and 150+ businesses across various services. Over 250K MAUs and 2 million app installations.

The business has teamed with MyGate to serve automobile owners of 25,000 societies on the site.

Rahm Shastry and his Silicon Valley Angel network funded the team and MVP launch. DriveU then raised $1 million from Unitus Ventures.

Equity and debt financing have raised $8 million for DriveU. Unitus Ventures, its main investor, has invested approximately $3 million, along with smaller Silicon Valley corporations and private equity investors.

In discussing DriveU, Unitus Ventures Managing Partner Will Poole states, “For over ten years, Unitus Ventures has invested in startups that use technology to bring convenience and efficiency to chaotic sectors in India. DriveU is one of India’s few organizations that accomplish this economically and at scale.”

Their on-demand drivers make more money and provide better service with well-trained and insured drivers. This is win-win. Flexible, dependable, and affordable mobility options will become increasingly important as cities become more crowded. Adding, DriveU is well-positioned to meet these changing expectations.
Taking over the market

Statistica India reported 326.3 million automobiles in fiscal year 2022. Road travel was favoured in India, with 60% of the people transporting themselves.

“We operate in a ‘shadow’ market that hasn’t been researched much, but Bengaluru has 22 lakh registered vehicles, and our penetration is two lakh. DriveU has 9% market share among automobile owners, says Ashok.

He describes the business model: “We charge customers a base fee plus any additional kms or minutes, keeping 20% and giving our drivers 80%. We also provide drivers performance rewards for meeting daily and weekly goals.

DriveU costs Rs 429 for a four-hour journey, Rs 129 for one hour, and a prorated fee every minute after a package. After-party drops cost Rs 529 and office travels cost Rs 259.

Other services include doorstep carwash, maintenance, denting, and painting cost Rs 499–Rs 3,999.

“Over the next year, we’ll focus on growing our core driver service market share in cities with less brand awareness and expanding our new verticals into all our markets,” adds Ashok.

In addition, we’re testing DriveU Plus, a premium tier of drivers on hire; DriveU EV; and DriveU daily, which lets consumers book the same driver for many days. He says that DriveU’s doorstep car wash would be revamped and offered specialized services to make it the UrbanCompany for auto ownership.

Nitin Gohil Author of Times Applaud
Nitin Gohil

A Mumbai-based tech professional with a passion for writing about his field: through his columns and blogs, he loves exploring and sharing insights on the latest trends, innovations, and challenges in technology, designing and integrating marketing communication strategies, client management, and analytics. His favourite quote is, "Let's dive into the fascinating world of tech together."

Nitin Gohil
A Mumbai-based tech professional with a passion for writing about his field: through his columns and blogs, he loves exploring and sharing insights on the latest trends, innovations, and challenges in technology, designing and integrating marketing communication strategies, client management, and analytics. His favourite quote is, "Let's dive into the fascinating world of tech together."

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