ONN bike is a Bangalore-based self-riding bike rental start-up founded in May 2015 and started operations in 2016. The start-up was ideated by Namit Jain and since has expanded its wings in Bangalore, Hyderabad, Jaipur, Udaipur, Mysore and Delhi NCR with a fleet size of around 2,000 bikes and plans to expand its geographical locations to 9 more cities and fleet size to 6,000.
In December 2016, the start-up had raised Angel funding of 65 lacs from ZNation Labs; 2 Cr from Grace Capital Ventures and off lately they rose a 4.5 Cr pre-Series A round funding by an existing investor, Z Nation Lab.
Jain spoke to Firstpost about plans to breakeven and challenges it faces in the sector.
Excerpts from the conversation
What has been the traction for the startup since it was founded in terms of vehicles, customers?
ONN Bikes has strong presence across Karnataka, Telengana, Delhi NCR, Rajasthan and Gujarat with an inventory of over 2500 bikes. We have a strong customer base of over 1 lakh and growing. Till date we have received three rounds of funding. We received the angel round of funds from Z Nation Labs amounting to 1 lakh dollars which was followed by an undisclosed amount as seed funding by Grace Venture Capital. In our recent round of funding, ONN Bikes received a total of Rs 4.5 crore as Pre-Series A that was led by Z Nation Labs, Venture Catalysts and JITO Angel Network. The funds will be utilized to strengthen our technology base, promote franchise model and to support our multi-city expansion plan.
Our customer base is divided into the B2B and B2C segment. Students, Travelers, working professionals and biking enthusiasts form a majority of our B2C segment. Companies relying on last mile delivery and those having ground sales, marketing and service teams form our B2B segment. Our Rent-to-Own model comprises of students and fresh out of college corporate employees.
What are your current plans?
There are 84 tourist destinations that have been recognized by Incredible India and this provides a huge growth opportunity for our segment. Apart from this, our B2B model has been widely accepted and we are currently servicing over 65 corporates and Logistic service providers. Our franchisee model too has been successful and we will soon roll it out nationwide. Going forward, all ONN Bikes outlets will be based on the franchisee model. At present, we have over 45 outlets across Bangalore, Hyderabad, Jaipur, Mysore, Udaipur and Delhi NCR. We will soon be foraying into another 10 locations and will have an overall inventory of 6000 bikes by the end of 2018.
We will soon introduce Ride Sharing model and in continuation to our endeavour for a greener future, we are also contemplating at introducing electric bikes.
What are the challenges that you face in the bike rental space?
Bike rental is a new concept in India. Though the industry has witnessed strong growth momentum, the major challenge is to build strong service awareness especially in Tier 2 cities and tourist destinations. The other major detriment is sourcing of bikes. As per our data, both B2C and B2B market combined have an immediate need of over 4 lakh bikes.
When does you expect to breakeven?
With the present growth rate, ONN Bikes will break even in the next 18 months.
What are its plans to meet up with competition considering there are many other players in the sector?
ONN Bikes is the leader when it comes to the fleet size and aggressive pricing. We do not have competition in the B2B space. We are the only company which is into long-term leasing of bikes and this gives us the first mover advantage. There are multiple aggregators in this space who have presence in more number of cities than ONN Bikes but they lose control over the service quality and maintenance of the vehicles, an utmost important factor in this business. ONN Bikes has complete control over the inventory and the operations even with its franchise model. This creates a strong trust factor with the consumers.
Updated Date: Mar 17, 2018 17:29 PM