Dunzo, a hyperlocal delivery unicorn, is reportedly in final discussions with its investors to raise nearly $50 million in a fresh funding round. The funding deliberations are largely held with existing investors, including Reliance Retail and Google, who are in talks to participate in the new fundraising round. However, it is noteworthy that Dunzo has been trying to secure funds between $70 million and $150 million for quite some time, according to ET reports. This news comes amid a funding winter in the Indian startup ecosystem. In FY22, Dunzo’s consolidated losses soared to INR 464 crore from INR 229 crore in FY21, while its operating revenue surged to INR 54.3 crore in FY22 from INR 25.1 crore in FY21. Dunzo has raised over $380 million so far, and its backers include Alteria Capital, Lightbox, 3L Capital, Krishtal Advisors, Ranjan Patwardhan, Rich Ravi Agrawal, and Google, among others. In the quick commerce segment, Dunzo competes with Swiggy’s Instamart, Zepto, Tata-led BigBasket, and Zomato-led BlinkIt.
It appears that Dunzo has raised a significant amount of funding from various investors, including Google and Reliance Retail. However, the company has been experiencing losses, with its consolidated losses doubling in FY22 compared to the previous year. Despite this, Dunzo is continuing to compete in the quick commerce segment, facing competition from other players such as Swiggy’s Instamart, Zepto, Tata-led BigBasket, and Zomato-led BlinkIt.
Closing dark stores can be a cost-cutting measure for quick commerce startups like Dunzo. Dark stores are fulfilment centers or warehouses that are designed to cater only to online orders, and they are not open to the public. By closing the low-demand dark stores in Delhi-NCR and Hyderabad, Dunzo can save on rent, utilities, and staffing costs, and redirect its resources to more profitable areas. This move can help the company improve its unit economics and achieve profitability in the long run.