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BluSmart raising $25 million from founders, to launch e-taxi services in Dubai next month

BluSmart co-founder Punit Goyal. Image: BluSmart

BluSmart, India's biggest e-cab operator, is raising $25 million from its founders and existing investors, with contributions from new investors as well, co-founder Punit Goyal told reporters in an interview.

The funding is expected to close by June-end, and will form part of a three-year, $300 million funding round the company will utilize to ramp-up its fleet and expand its footprint in India and overseas.

BluSmart will use the fresh funds to expand Indian operations beyond Delhi and Bengaluru, while maintaining its focus on large cities, where it plans to offer premium service using cars from top manufacturers. "We don't want to go to small cities because that's not where the revenue comes from," Goyal told reporters. "Cheap rides, cheap quality, cheap service and cheap pricing are not our forte." In previous interviews, Goyal had said the company was looking to enter Mumbai by the third quarter of 2024.

BluSmart plans to increase its India fleet, comprising EVs from Tata Motors, BYD, MG Motor and Citroën, from 7,500 at present to 13,000 by March next year and 25,000 cars over the next three years.

The Global Founders Capital and BP Ventures-backed company --- which exclusively relies on electric vehicles --- will also launch services in Dubai next month, starting out with about 100 Audi EVs which it plans to increase to 300 Audi and Tesla EVs by December.

BluSmart is also looking to double its revenue to $110 million by March 2025, Goyal said, but wouldn't comment on profitability. The company, which has secured ~$200 million in equity and long-term debt, believes it has a better model than ride-hailing competitors because it operates a fleet on long-term lease as against the need for drivers to own and maintain their vehicles when working for rivals.

"We can't beat them [competitors such as Ola and Uber] on scale," Goyal had conceded in an interview last year while talking about BluSmart's early planning, adding, "We wanted to beat them on quality." He went on to explain that the possibility of badly maintained cars, backlash from surge pricing and risk of dropped rides were among the factors that competitors had to contend with, which BluSmart sought to overcome with its business model.

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