Dunzo Digital Pvt. Ltd, which runs a diversified hyperlocal delivery services platform, has raised $11 million (about Rs 78.8 crore at current exchange rates) in venture debt from Alteria Capital.
The Bengaluru-based firm said in a statement it will use the funds to grow in its existing markets.
“Profitability has always been the barometer of success and we’re seeing it manifest across several of our micro-markets,” Kabeer Biswas, co-founder at Dunzo, said.
The latest investment from Alteria comes after the venture debt fund provided Rs 7 crore (around $1 million) to Dunzo in November 2018. At the time, Dunzo had said it would use the funds for general corporate purposes and expanding its services.
Dunzo was founded by Biswas, Mukund Jha, Dalvir Suri and Ankur Aggarwal in 2015. It operates a task management application that allows users to create to-do lists. The startup fulfills tasks such as grocery and restaurant deliveries, instant local courier services and home services.
Other backers of Dunzo include Blume Ventures, Kalpavriksh Fund, and Patni Wealth Advisors, according to VCCEdge, the data research arm of Mosaic Digital.
This capital infusion comes after Dunzo raised $45 million (Rs 318.58 crore) in a fresh funding round in October last year from Lightbox, the US-based growth equity firm 3L Capital, and South Korea's STIC Investment & STIC Ventures.
Separately, Alteria managing partner Vinod Murali said Dunzo and its management team has been able to set a benchmark for hyperlocal services, adding that the firm was in a position to become a market leader in the competitive segment.
Dunzo’s platform combines the use of both artificial intelligence and human operators to offer its services. It has a presence in cities such as Mumbai, Bengaluru, NCR, Hyderabad and Pune. In May last year, the company raised funding from Kalpavriksh, the private equity arm of financial services firm Centrum.
Before that, in February, Dunzo raised $6.5 million (around Rs 46 crore) from a clutch of new and previous investors including Deep Kalra, the chairman and group chief executive officer of online travel services provider MakeMyTrip.
The venture debt firm was founded by Murali and Ajay Hattangadi in 2017. The two were former executives at InnoVen Capital.
The firm focusses on innovative startups that are backed by strong venture capital sponsors. It looks for capital-efficient business models and a clear differentiation strategy among potential investees, according to its website.
Apart from Dunzo, some of the firms in its portfolio include financial technology firm Lendingkart, used car platform Spinny, education-technology startup Toppr and health-technology firm Portea.
