Vahak is not only an open marketplace for truckers, but also provides drivers with services such as health care and discounted fuel cards. The Bangalore-based company announced today that it has raised a Series A round of $14 million. The round was led by Nexus Partners, with participation from Foundamental, iSeed Ventures, Leo Capital, RTP Global and Tital Capital.
This brings Vahak’s total raised so far to $20.3 million since its inception in 2020 by Karan Shaha and Vikas Chandrawat. The two met while studying Mechanical Engineering at IIT Kanpur. Shaha says they decided to found Vahak because of the problems he saw one of his relatives, who owns a factory, facing.
“The problem was related to booking trucks,” Shaha explains. “The irregular freight, lack of communication channels, mistrust and lack of visibility were evident. Digging deeper, we realized that this was a huge national problem that needed immediate improvement.
Vahak initially provided transport services in Raipur, Shaha’s hometown. After more than two years of operation, “we understood the issues a carrier faces on a daily basis,” he said. “Irregular earnings, insane working hours, lack of proper health care, to name a few.” As a result, Vahak pivoted to a technology-only model in 2019 and launched the following year.
Vahak connects people who have goods to ship with truckers and enables payments through the apps. The company says Vahak Payments prevents fraud by securing transactions, allowing drivers to get paid faster, and enabling prompt refunds when needed.
The company’s goal is to expand its operations to 10% of Indian logistics markets and grow from 1.5 million users currently to 10 million within a year.
Shaha says India’s transport industry is “very disorganized and fragmented”, despite being worth $200 billion. About 70% of trucks are owned by one person, who also drives the truck. In order to secure reservations, they usually rely on phone calls.
“It creates silos where the personal network of relationships is the only way to know someone’s credibility,” Shaha said, adding that it usually takes truck owners two to three days to find their next order. Shaha says truckers who join the platform can operate 25-26 days a month, instead of 12-15 days, as bookings are made faster.
Vahak’s app also offers drivers medical consultations through telehealth company Medibuddy, health and transit information, and fuel cards that can be used to buy gasoline at discounted rates. Shaha said these features were added because the trucking industry in India “lacks an effective ecosystem to support the lives of truck drivers and smallholders.
The company is currently in the pre-revenue phase, but Shaha said that in the future it will monetize through value-added services, such as escrow, insurance, fuel, GPS and commissions. directly on transactions.