DriveU Approaches Profitability with 650K Customers and Rs 61 Crore in GMV

In 2015, Ashok Shastry and Rahm Shastry, a father-son duo, founded DriveU with the goal of offering technology-driven, on-demand, and affordable private driver services. Their vision was to enhance the driver and customer experience by providing transparent pricing, safety assurance, uniformity, and scalability through technology. DriveU took a significant step in 2021 when it introduced the DriveU super app, expanding its services to include doorstep car wash, car servicing, FASTag recharge, and insurance renewals. As of now, the platform boasts a network of over 65,000 background-verified drivers across major Indian cities, including Delhi-NCR, Mumbai, Bengaluru, Hyderabad, Chennai, Ahmedabad, Kolkata, Pune, and Coimbatore.

Following impressive growth in FY23 and successful fundraising rounds, DriveU, headquartered in Bengaluru, is preparing to launch a premium driver service called DriveU+. This premium service will provide experienced and verified drivers to customers. The company is also in discussions with potential investors to secure its next round of funding. The primary objective is to raise $10 million in equity and debt to fuel rapid growth and expedite product development.

While DriveU is already EBITDA-positive and cash flow breakeven, the primary focus is on expanding car ownership services geographically and strengthening its core driver service within the cities it operates. The company is actively seeking a substantial funding round to accelerate these growth initiatives.

Owned by Humble Mobile Solutions Pvt. Ltd, DriveU's ambitious target for 2023 is to double its revenue to Rs 120 crore, up from the current Rs 61 crore, without the need for additional funding. In FY23, the startup achieved a Gross Merchandise Value (GMV) of Rs 60.9 crore, marking a remarkable 126% growth compared to FY22 when it generated Rs 27 crore GMV. DriveU serves both B2B and B2C customers with its core offering, which includes on-demand driver services. B2C users can hire temporary drivers by the hour or day, while businesses rely on DriveU's on-demand drivers to replace fixed drivers with associated fixed costs.

DriveU has garnered prominent clients in used car platforms, OEM service stations, and insurance companies, streamlining their operations and finances. The startup has also ventured into valet parking services for B2B customers, collaborating with premium pubs in Bengaluru and Hyderabad to promote responsible consumption.

One of DriveU's distinguishing features is its rigorous background verification process for drivers, including criminal record checks, court record checks, driver's license verification, and address verification. The company has also developed a robust tech stack to ensure driver punctuality, fitness to drive, and user-friendly app access for requesting drivers. Safety services are a priority, with real-time driver tracking and multiple payment options available to customers.

Additionally, DriveU offers optional trip insurance to cover minor car damages, 24x7 driver service, and live customer support. B2C users can earn rewards in DriveU coins, redeemable for services like doorstep car wash, car servicing, and insurance renewals through the app. To date, DriveU has completed over five million trips, serving over 650,000 direct customers and 150+ businesses. The company boasts more than 250,000 monthly active users and over two million app installs.

DriveU has also partnered with MyGate to cater to car owners residing in the 25,000 societies using the MyGate platform for additional convenience.

Regarding funding, DriveU initially received capital from Rahm Shastry and his Angel network based in Silicon Valley, which helped establish the team and launch the minimum viable product (MVP). Subsequently, DriveU secured $1 million in funding from Unitus Ventures. To date, the startup has raised $8 million through a combination of equity and debt financing. Unitus Ventures has been a primary investor, contributing nearly $3 million to DriveU's growth. The company has also attracted investments from smaller firms and private equity investors in Silicon Valley.

Will Poole, Managing Partner at Unitus Ventures, praised DriveU's success, emphasizing how the company's technology-driven approach benefits both drivers and customers. He highlighted DriveU's role in meeting the increasing demand for flexible, reliable, and cost-effective mobility solutions in congested urban areas.

With India's significant number of vehicles and a preference for road travel, DriveU aims to capitalize on the market's potential. While exact figures are challenging to quantify due to the nature of the market, DriveU has achieved a 9% market share among car owners in Bengaluru, reaching two lakh out of 22 lakh registered vehicles. DriveU operates on a revenue-sharing model, charging customers a base fee plus additional fees based on usage, with 20% retained by the company and 80% going to drivers. Drivers receive performance incentives for meeting daily and weekly targets.

Looking ahead, DriveU plans to focus on expanding its core driver service market share in cities with lower brand awareness while extending its new verticals to all its operational markets. The company is exploring various driver service offerings, including DriveU Plus (a premium tier of drivers), DriveU EV, and DriveU Daily (allowing users to book the same driver for multiple days). Furthermore, DriveU intends to revamp its doorstep car wash service and introduce additional specialized offerings to establish itself as the go-to platform for car ownership services, similar to UrbanCompany in the service sector.