Becomes first ever on-demand company to generate positive cash flow
India, July 3, 2017: — Jugnoo, India’s leading hyperlocal startup, offering a diverse range of services like Rides, Ready to Eat Meals, Restaurant Food Delivery, Grocery and B2B Delivery, becomes the first ever company in on-demand space to turn cash flow positive with profitability on an EBITDA basis. The big announcement from Jugnoo comes at a time when most industry players are burning an enormous amount of cash for customer acquisition.
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The breakthrough for Jugnoo validates its invariable lack of conviction for the cash burn model. Since inception, the company has been focussed on sustainability and unit economics rather than growth that comes by burning money blindly. Being EBITDA positive in less than 3 years of inception, largely reflects the strength of the business model of Jugnoo in hyper-local space.
Commenting about the development and future roadmap, Samar Singla, Founder and CEO at Jugnoo said, “We have always believed in the significance of developing a scalable but sustainable business model. This achievement means a lot to us as it reaffirms our faith. We have witnessed 250% growth over the past one year and are on track to achieve net revenue of Rs 70 crores in current FY.”
All the verticals of Jugnoo complement each other, facilitating better economies of scale. Despite having a wide presence across 35 cities in India, the company has evolved a unique operating structure that gives the benefit of centralized control with decentralized execution.
Identifying opportunities in Tier II and Tier III market, the company has emphasized primarily on these cities rather than the metropolis. According to Samar, operating in Tier II and Tier III cities has its own advantages like higher brand loyalty of customers due to limited options and growing adoption of tech platforms for their daily purchases.
With an army of 15,000 auto drivers, Jugnoo handles 50,000 transactions per day for around 5 million users. The company has also diversified into global markets with its B2B ventures, providing cost effective B2B logistics solutions to over 17,000 clients in 150 countries across the world. This has been a significant initiative leading to better avenues of growth and generating more revenue for the company.
Samar attributes ‘Execution-capability’ as one of the key differentiating factors compared to others in the space. Going forward, the company intends to further substantiate its profitable growth by having its own private label brands that enhance its loyalty quotient with its customers.
Jugnoo has raised USD 16 million in two rounds of funding over the past two years. But turning cash flow positive means that the company will now be funded by its customers rather than investors. While the industry is saturated with competition, this is certainly a huge milestone for Jugnoo…