Rapido, an eight-year-old Indian startup known for its bike taxi services, is entering the traditional cab market to compete with Uber and its local rival, Ola. The Bengaluru-based company has initiated a pilot for its cab service in Hyderabad, with plans to expand to other cities including Delhi-NCR, Bengaluru, and Chandigarh. Rapido’s expansion into car services diversifies its offerings and may help attract a broader customer base. The move also increases customer loyalty by providing existing users with the option of choosing a Rapido cab when they need a car ride. The company is set to launch Rapido cabs in Delhi-NCR as early as next week.
Until now, Rapido customers could hail rides on motorcycles or three-wheeled auto-rickshaws. The addition of cabs allows Rapido to tap into a larger market segment and compete more directly with established players in the ride-hailing industry. The company is currently conducting a test run of Rapido Cabs in Hyderabad, and the response has been positive, according to a company spokesperson.
Rapido’s strategic move includes plans to integrate intercity bus ticket booking within its app through a potential partnership with Zingbus, a company based in Gurugram. This collaboration could benefit Rapido by expanding its gross merchandise value (GMV) and assist Zingbus in reaching a broader audience. Both Rapido and Zingbus have not officially commented on the reported partnership.
Founded in 2015, Rapido operates in over 100 cities in India and boasts more than 25 million app downloads. With over 10 million customers and 100 million rides completed, Rapido has established itself as a major player in the Indian ride-hailing market. The company aims to offer affordable intra-city travel and enhance last-mile connectivity through its platform.
India’s ride-hailing industry was historically dominated by a duopoly consisting of Uber and Ola, which collectively held a 90% market share. However, recent entries like BluSmart with an all-electric fleet and inDrive with its unique haggling model have disrupted the market. Rapido’s expansion into traditional cabs reflects the evolving dynamics of the Indian ride-hailing sector.
While India has a large number of traditional cabs, the price sensitivity of its population has driven companies like Uber and Ola to introduce bike taxis in major cities. Rapido positions itself as a viable alternative to these services, leveraging its extensive presence in the market. However, regulatory ambiguity regarding bike taxi operations in different Indian states poses a challenge for platforms like Rapido.
To support its expansion plans and maintain competitiveness, Rapido has secured significant funding, totaling $324 million according to available data. The company’s investors include VC firms WestBridge, Shell Ventures, Nexus Venture Partners, and AdvantEdge. Additionally, it has received backing from food delivery aggregator Swiggy and leading Indian two-wheeler manufacturer TVS Motor Company. Rapido’s foray into the cab market aligns with its goal to become one of the fastest EV companies to achieve profitability, with an Ebitda profitability target set for FY25. As the company prepares for an initial public offering (IPO), this strategic expansion aims to strengthen its position in the evolving landscape of Indian mobility services.
