Rapido’s Growth in the Four-Wheeler Market

Rapido is notably expanding its influence in the four-wheeler sector after establishing a robust foothold in the two-wheeler domain. The ride-hailing platform is making significant strides amid heightened competition and broadening its reach beyond metropolitan areas. To boost its growth, strengthen its presence in both existing and new markets, and enhance its captain network, the company has successfully raised $240 million in primary funding. This round was led by Prosus, with contributions from WestBridge Capital, Accel, and several other investors.

This funding is part of a larger $730 million primary and secondary share sale. To delve deeper into the insights surrounding the Bengaluru-based company’s recent funding, Startup Superb evaluated its regulatory filings, scrutinising aspects such as transaction structure, investor involvement, shareholding, and valuation.

According to Rapido’s submission to the Registrar of Companies (RoC), the board has allocated 158,645 Series F compulsory convertible preference shares (CCPS), priced at Rs 135,398 each, thereby raising Rs 2,148 crore, equivalent to approximately $226 million. Prosus, via MIH Investments One B.V., spearheaded this funding round with an investment of Rs 1,566 crore, around $165 million. Existing investor WestBridge Capital participated through Setu AIF Trust, Konark Trust, and MMPL Trust, investing Rs 223.75 crore, or $23.5 million.

Additionally, Accel and Invus Opportunities contributed Rs 179 crore, or $18.8 million, and Rs 134.2 crore, approximately $14.1 million, respectively. Meanwhile, Think Investments added Rs 44.7 crore, amounting to $4.7 million. Post-money, Rapido’s valuation has surged to Rs 26,761 crore, which is around $2.82 billion. Note that USD-to-INR conversions are based on an exchange rate of Rs 95 per USD.

Established in 2015, Rapido has expanded its operations to over 400 cities, solidifying its standing as one of India’s top mobility platforms across various services such as bike taxis, auto-rickshaws, and cabs. The business model is designed around providing affordable transport options while simultaneously offering flexible income opportunities for driver-partners.

To date, the ride-hailing company has secured almost $730 million across several funding rounds. Following the latest share allocation, WestBridge Capital stands as the largest shareholder with a 29.7% stake, followed by Prosus at 26.2%. Nexus Venture Partners, Accel, and Integrated Capital account for 9.1%, 3.6%, and 3.2% stakes, respectively. Co-founders Aravind Sanka, Pavan Guntupalli, and Rishikesh SR maintain approximately 10% ownership in the company.

Last year, food delivery leader Swiggy and TVS Motor Company exited their investments in Rapido, achieving substantial returns. Swiggy disposed of its stake for Rs 2,399.5 crore to Prosus-backed MIH Investments One B.V. and investors linked to WestBridge, realising more than a 2.5x return on its investment made less than four years earlier. TVS Motor also divested its interest for Rs 288 crore to Accel and Prosus.

In the financial year 25, Rapido demonstrated impressive financial results, with operating revenue climbing 44% to Rs 934 crore from Rs 648 crore in FY24. The total income exceeded Rs 1,000 crore, allowing the firm to reduce its net loss by 30.5% to Rs 258 crore from Rs 371 crore the previous year. The company is yet to make its FY26 financial results public.

In response to rising competition in the ride-hailing market, Rapido’s main competitor, Uber, recently injected Rs 3,000 crore into its Indian subsidiary, Uber India Systems Pvt Ltd. This investment was prompted as Uber’s CEO, Dara Khosrowshahi, identified Rapido as the most significant competitor in India, positioning Ola as a distant third.

Meanwhile, Ola has commenced preparations for its IPO, despite a challenging FY25, during which its revenue fell by 42% to Rs 1,170.9 crore, while net losses widened to Rs 662.4 crore.