Image Source: Rediff Money
Rapido, which dominates the bike taxi space, is making a daring foray to eat more into India's ride-hailing space by growing aggressively in four-wheeler cab space. With a pan-India roll-out of Rapido Cabs and a 500-city expansion plan in process, the company is using its unique business model to take on incumbent players Ola and Uber.
Rapido, long associated with its dominance in bike taxis, is now quickly expanding its four-wheeler cab business. Its strategic drive is supported by a novel subscription-based platform for drivers and an aggressive growth plan for both metros and smaller towns. The development is likely to stiffen competition in India's vibrant ride-hailing market and has the potential to redefine the market dynamics.
1. Four-Wheeler Growth and Market Ambition
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Rapido has rolled out its cab services across the country, beginning with an initial strength of 100,000 vehicles, competing head-on with Uber and Ola in the four-wheeler segment.
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The firm is already logging approximately 500,000 cab trips every day, with projections of strong expansion in this category.
2. 500-City Expansion Drive
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Rapido is part of an aggressive strategy to go to 500 cities in India by 2025, concentrating on metro areas as well as tier-two, tier-three and below cities.
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More than 35% of Rapido's bookings come from Tier-three, Tier-four and Tier-five cities, speaking volumes of their resolve to penetrating deeper markets in addition to metro.
3. Revolutionary SaaS-Based Subscription Model
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Unlike older commission-based schemes, Rapido uses a Software as a Service (SaaS) model under which drivers pay a small membership fee (e.g., ₹500 after making ₹10,000), ensuring they keep most of their money.
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This system has been responsible for optimizing drivers' earnings and bringing in additional captains (drivers) to the platform.
4. Staggering Growth Figures
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Rapido now has 31.8 million active monthly users, closely following behind Uber (33.6 million) and Ola (28.6 million).
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The firm enables around 3.3 million rides per day in bikes, autos, and cabs, with a 61% market share in bike taxis and increasing leadership in other categories.
5. Financial Performance and Funding
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Rapido's revenue grew 46% to ₹648 crore in FY24, while losses were cut in half to ₹370 crore, and further declined to ₹17 crore in Q1 FY25.
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The firm became a unicorn in 2024 after it raised $200 million Series E capital and has garnered interest from overseas investors.
6. Diversification for Various Indian Markets
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Rapido personalizes its services according to the needs of cities, as it understands that smaller towns have different mobility trends than metros.
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The firm's game plan involves introducing new use cases and overcoming the hurdles towards adoption of ride-sharing in different regions.
Relevant Sources: The Hindu Business Line, YourStory, Business Standard, Economic Times, EVStory, Motilal Oswal
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