After Cabs, Bus Startups Are Now on Investors Radar



BENGALURU: The advent of Ola and Uber has definitely made cab transportation much easy in several mega cities.

Emerging companies such as rBus, Shuttl, ZipGo and Cityflo plan to do the same by innovating the bus facility to daily commuters. Passengers can now book their bus seats in AC buses via the web or mobile app in business hubs like Bandra Kurla complex of Mumbai.

Popular cab service Ola, plans to invest Rs 120-150 crore in introducing bus facilities which is already tempting potential investors like Sequoia Capital, Nexus Venture Partners and IDG Ventures. An early investor in Ola, Anupam Mittal believes bus service will be much bigger in size than cabs( whose value is approximately 60000crore). He said, “There is a very large and growing population of commuters who would rather not deal with the hassle of parking if a reliable daily commute is available.”

Shuttle , a Delhi based bus service has secured Rs 19.5 crore from Sequoia Capital and corresponding angel investors. Zipgo is also in talks with Orios Venture Partners to gain funds for further developments. Cityflo, an initiative by IIT-Bombay graduates is in talking terms with Nexus Venture and IDG Ventures to strengthen its funding grounds.

Business plans for each of these bus startup differs. Shuttle restricts its area to Guragaon and aims in collecting payment via the app. rBus and Cityflo aims the long distance office goers as their primary customer range.

Jerin Venad, confounder of Cityflo spoke about his business, "We guarantee an air-conditioned, seated travel and an app to book our service on demand and on subscription. We have picked up business locations and residential complexes. By running buses to these corridors we are catering to a lot of people who don't have a comfortable option to get to work," 

rBus recently launched its mobile app which users will be able to access from September. The standard rate for this service is 500 for 10 rides in a week.

According to survey results, presently 70 million people travel bus in a day in this country. The number of buses range around 1.5lac buses.

State bus services design bus routes based on public demand. These startups aim to render company based bus service in the big cities of India.

Director for transport and logistics at KPMG, Prahlad Tanwar comments "Public transport has not kept up with new business centres coming up across metros, which has created a vacuum and need for these kind of services." 


Ona global basis, these startups will be facing strong competition from China's largest cab aggregator Didi Kuaidi, that grew very fact since its emergence in July; UberPOOL, a car pool system launched in the U.S. by Uber.

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