Doodhwala, which operates in hyperlocal milk and grocery subscription delivery space, is planning to raise a fresh funding of over $10 million. The Bengaluru-based firm with annual revenues of Rs 40 crore, is in advanced talks with the potential investor(s) for the new round that is expected to conclude by the end of the current fiscal.
Ebrahim Akbari, co-founder, Doodhwala, said, “We will be raising money soon again. The funds raised earlier were utilised mainly for building the team and the technology for the next level of growth. This time around it will be a bigger sum, a little upwards $10 million and will get done by around March 2019.”
A new investor is expected to onboard the start-up owned by Banger Tech Pvt Ltd, leading the round that’s currently under negotiation. It will also see follow-on investments from the existing investors. Last year, the company had raised undisclosed amount from Tom Varkey, a partner at US-based hedge fund Stonehill Capital, followed by a pre-Series A of $2.2 million from impact venture fund Omnivore in February 2018.
Household distribution of fresh milk is $10-12 billion market in India, Akbari said quoting a 2016-17 Rabobank survey. “Over the next decade or so, the market is expected to grow 1.5 to 2 times,” he said.
Growth for Doodhwala is expected to come from two areas. One, the management is looking to add 15-odd cities over the coming months. Secondly, the company has been running six different pilots and is planning to roll out the new services/offerings within the next couple of weeks.
Akbari said new updates are being offered with the focus being groceries and fresh vegetables. “Dairy, the way we handle it, nobody does. Fresh produce and perishables is another problem area that we identified and it needs to be effectively addressed. We are addressing this consumer need through our pilots that are running for the past six-odd months in select areas of Bengaluru. We have put various assortments for our customers to really understand what they want.”
Based on their learning from the pilot, a new version of the Doodhwala mobile application, with a few categories that are relevant to customers but mainly revolving around fresh perishables, will soon be added.
$10-12bn – Market for household distribution of fresh milk in India
1.5litre – Average consumption of milk per household on Doodhwala