The inefficiencies of India’s trucking industry continue to pull the economy down. After receiving new capital, BlackBuck, one of the few firms modernising freight and logistics across India, has just achieved unicorn status. In an interview with TechCrunch earlier this week, BlackBuck chief executive Rajesh Yabaji said that Tribe Capital, IFC Emerging Asia Fund, and VEF led the $67 million Series E financing round in the six-year-old startup, valuing it at $1.02 billion (up from about $850 million in the 2019 Series D round). This year, BlackBuck is the 16th Indian firm to achieve unicorn status.
BlackBuck connects companies with trucking companies and freight forwarders. The company has created a simple software for truck drivers in India, who are often illiterate, that allows them to accept jobs and navigate to their destinations using Google Maps. Businesses can use similar software to place orders on the client side.In India, over 700,000 drivers and 1.2 million trucks are connected to the platform, which processes over 15 million transactions every month. “Truck drivers in India did not go fully digital until 2019.” “Since then, supply activity has increased by a factor of 20,” Yabaji said.
“When we founded BlackBuck in 2015, just 40% of truck owners had smartphones, and only 7% of truck drivers had smartphones. “By 2019, 100% of truck owners and 70% of truck drivers have cellphones,” he claimed, citing the introduction of low-cost Android smartphones and access to considerably more affordable mobile data as reasons for the growth (thanks to Jio Platforms).
“On top of that, the government began pressuring people to adopt digital technology. He added, “There is now a computerised toll system, and several state governments have made GPS necessary.”
During this time, BlackBuck has also changed dramatically. The platform has switched from a call center-based approach to an app-based one for booking orders. Because more truckers and fleet owners now have smartphones and can book directly, Yabaji claims the startup’s reliance on brokers, who help connect them to truckers in smaller areas, has decreased.“On the supply side, the platform was designed to be agnostic to who was placing the order. The load is available to anyone who has access to capacity in a specific area and at a specific time. On the whole, we were fine with it from the start,” he explained. “Right now, small fleet owners with two to three trucks account for 95 percent of load acceptance.”
Making inroads with small and medium-sized enterprises has been another hurdle for BlackBuck. Large businesses have always been the platform’s biggest customers. Things have changed considerably, according to Yabaji, with SMEs accounting for the majority of BlackBuck’s recent growth. The company has around 10,000 customers in total.
The expansion of BlackBuck’s FASTag product has been one of the company’s biggest triumphs in recent years. (In India, FASTag is an electronic toll collection system that allows users to pay tolls immediately from their linked prepaid or savings account or straight to the toll owner.) According to Yabaji, BlackBuck accounts for 35 percent of India’s trucking toll spending today.