DailyNinja, the subscription based milk and grocery delivery startup, is looking to raise USD 18-20 million (Rs. 128-140 crore) in a fresh round of funding. Citing two unnamed sources, a Mint article said its existing investors Sequoia Capital, Matrix Partners and Saama Capital are likely to participate in the round.
The Bengaluru-based company plans to use new funding to expand to new cities including Delhi-NCR and scale up its business. DailyNinja will also look to expand its user base from current 60,000 to 200,000 over the next two years, the report said.
Founded by Anurag Gupta and Sagar Yarnalkar in 2015, DailyNinja operates in multiple cities including Bengaluru, Hyderabad, Chennai, Mumbai and Pune. The company partners with milk vendors, milk brands and grocery distributors to digitise the supply chain. It allows users to buy subscription for everyday essential products such as milk, bread, eggs, fruits and vegetables.
In the last couple of years, the milk and grocery delivery space has gotten crowded and has become one of the most sought after sector for VCs as it promises regular orders due to high demand. DailyNinja competes with companies like Milkbasket, Doodhwala and Country Delight. Unicorns such as grocery delivery company BigBasket and food delivery giant Swiggy, have also expanded to cater to the early morning milk and grocery delivery needs.
BigBasket has two pronged strategy to grab the niche segment. In October, BigBasket acquired Pune-based RainCan and Bengaluru-based Morning Cart to go into micro-delivery business. Branded as BB Daily, it currently operates in seven cities, delivering milk and vegetables early morning. BigBasket also bought a controlling stake in smart vending machines firm Kwik24 in July 2018 and rebranded it as BB Instant, which operates automatic vending machines through a standalone app.
DailyNinja has raised about USD 8 million from Sequoia Capital, Matrix Partners and Saama Capital, according to the Forbes India report. Last year, DailyNinja raised two rounds of funds from the existing investors. The company used the funding to buy two of its smaller rivals.
In August last year, DailyNinja acquired Hyderabad-based hyperlocal delivery startup 4amShop for an undisclosed amount in an all-cash deal. Two months later, it acqui-hired yet another Hyderabad-based milk delivery startup WakeupBasket in a cash-and-equity deal.
“If you order from grocery startups, you have to select a slot for delivery and be at home to receive it. The milk vendor-based system is frictionless because they know your house and will leave the order outside every morning without fail,” Yarnalkar told Forbes last month when he, along with his co-founder Gupta, was named under Forbes 30 under 30 list.
By deploying milk vendors, DailyNinja has tapped into the captive customer base, said Yarnalkar. According to Forbes India, DailyNinja takes a commission from its partner stores and milk companies and makes about Rs. 35 lakh a month. It pays only Rs.1.5 per order (with the average basket size of Rs. 60-65) to milkmen, apart from the usual commission for delivering milk.