Drivezy

Drivezy was a vehicle-sharing platform founded in 2015 that offered self-drive cars, bikes, and scooters on rent.⁵¹²¹⁸ The company raised over $40 million in equity financing from investors including Das Capital, Y Combinator, and White Unicorn Ventures.¹⁰ Drivezy had to shut down their operations completely, according to a study on emerging trends in Indian startup ecosystem.⁷

Timeline

Money raised

Drivezy raised an undisclosed amount of angel funding in August 2015 from investors including Alok Mittal, Zishaan Hayath, Niraj Singh, and Nikunj Jain.¹² In November 2015, Drivezy raised $2 million in funding.¹² In March 2016, Drivezy raised $400K in a Pre-Series A round from angel investors.¹² In November 2016, Drivezy raised Rs 20 crore in funding.¹⁶ In October 2017, Drivezy raised $10 million in funding.¹⁶ In November 2018, Drivezy raised $20 million in Series B funding led by Das Capital, with participation from Yamaha Motor Co Ltd, Axan Partners, and IT Farm.⁶⁸¹²¹⁶ In November 2018, Drivezy also secured $100 million in an asset financing deal through Harbourfront Capital, a Special Purpose Vehicle, with financing handled by Tokyo-based Anypay Inc.¹⁰¹² In March 2019, Drivezy was in the process of raising $100 million in equity funding and $400 million in asset financing at a $400 million valuation.⁸⁹ In February 2020, Yamaha invested $35 million in Drivezy.¹⁶ Drivezy has so far raised over $40 million in equity financing from investors such as Das Capital, Y Combinator, and White Unicorn Ventures.¹⁰

Investors named in the sources: Das Capital^6810111216, Y Combinator⁸¹⁰¹², White Unicorn Ventures¹⁰, Yamaha Motor Company⁸⁹¹⁰¹⁶, Axan Partners⁸⁹¹⁶, IT-Farm⁸⁹¹¹¹⁶, Bain Capital¹¹¹⁶, Accent Equity Partners¹¹, Alok Mittal¹², Zishaan Hayath¹², Niraj Singh¹², Nikunj Jain¹², AnyPay¹⁰¹², Shell Global¹⁰.

What happened

Drivezy was founded in April 2015 by Ashwarya Pratap Singh, Hemant Kumar Sah, Vasant Verma, Amit Sahu, and Abhishek Mahajan as a car-sharing service.¹² The company was initially called JustRide and operated as an aggregator model where people could hire cars and motorcycles from people around them.¹² In November 2015, Drivezy raised $2 million in funding.¹² In March 2016, Drivezy raised $400K in a Pre-Series A round from angel investors.¹² In 2016, Drivezy toyed with the idea of building a marketplace where individual owners could list their idle vehicles, and the platform was rolled out in Bangalore, Mumbai, and Pune.¹²

In 2017, Justride rebranded to Drivezy and started featuring two-wheelers in addition to cars.¹² In November 2018, Drivezy raised $20 million in Series B funding led by Das Capital, with participation from Yamaha Motor Co Ltd, Axan Partners, and IT Farm.⁶⁸¹²¹⁶ In November 2018, Drivezy secured $100 million in an asset financing deal through Harbourfront Capital, a Special Purpose Vehicle, with financing handled by Tokyo-based Anypay Inc.¹⁰¹² In March 2019, Drivezy was in the process of raising $100 million in equity funding and $400 million in asset financing at a $400 million valuation.⁸⁹ In March 2019, SoftBank and Amazon were reportedly in talks to lead a $100 million equity financing round in Drivezy, but the round did not close.¹²¹⁶

Drivezy had early talks with Bounce and Zoomcar for different mergers and acquisition proposals, but did not go ahead with them.¹² From March 2018 to March 2019, the founders decided not to draw their salaries to conserve cash.¹² By December 2019, Drivezy was able to contain costs by more than 30% and total revenue increased 2.8x.¹² In 2019, Drivezy commenced car-sharing services in San Francisco, becoming the first and only Indian vehicle sharing platform to begin operations in the USA.¹² In February 2020, Yamaha invested $35 million in Drivezy.¹⁶

In July 2020, Drivezy planned to liquidate around 30% of its 15,000 two-wheelers and part of its four-wheeler fleet due to mounting debt and falling demand.² Drivezy saw a 40% fall in demand over the three months prior to July 2020, forcing it to hive off a part of its vehicle fleet.² Drivezy launched a pre-owned vehicles buying and selling platform to dispose of used vehicles.² Drivezy planned to gradually add a fleet of electric vehicles by setting up a joint venture with an EV maker.² In September 2020, Drivezy was in talks to raise $30-35 million in equity funding from a UAE-based sovereign wealth fund, Gulf investors, Yamaha, and Shell Global, at a post-money valuation of $100 million.¹⁰

Drivezy was also evaluating shifting its headquarters to Abu Dhabi once the deal went through.¹⁰ By December 2021, Yamaha was putting out a prepackaged insolvency resolution plan to purchase Drivezy's assets in the US and India through an ABC filing in Delaware and bankruptcy at the NCLT.¹³ Yamaha received sensitive information from Drivezy to evaluate a potential $35 million acquisition made through insolvency.¹³ Yamaha initially lent some money to Drivezy as part of the insolvency procedure by purchasing its assets, and began paying Drivezy's employees' salaries.¹³ Yamaha allegedly demanded that tangible assets like cars be given over to the company.¹³

Drivezy alleged that Yamaha surreptitiously engaged in activities competitive to Drivezy using confidential information to set up a similar business.¹³ Yamaha made investments in Rapido, Zypp, and Royal Brothers, competitors of Drivezy, and allegedly gave them access to Drivezy's confidential information.¹³ Yamaha allegedly used a Dubai-based organization to create its own digital platform comparable to Drivezy.¹³ Yamaha allegedly reneged on a $41,000 payment through the Startup Scale 360 accelerator and informed Drivezy that its declared intent to buy the company had expired.¹³ Drivezy sought an injunction to ban Yamaha from starting a similar firm and to cease using its proprietary knowledge.¹³

Drivezy had to shut down their operations completely, according to a study on emerging trends in Indian startup ecosystem.⁷

Legal outcomes

• filedDrivezy sued Yamaha, alleging that Yamaha leveraged confidential data to set up a competing business and abandoned the acquisition.¹¹³¹⁴
• filedDrivezy sought an injunction to ban Yamaha from starting a similar firm and to cease using its proprietary knowledge.¹³
• pendingMoto Business Service India Private Limited, a Yamaha division, stated that the charges are absolutely without merit.¹³

Where the founders are now

Ashwarya Singh is the CEO and a co-founder of Drivezy.¹⁸ Abhishek Mahajan is a founder of Drivezy.¹⁷ Vasant Verma is a founder of Drivezy.¹⁷ Amit Sahu is a founder of Drivezy.¹⁷

Sources

1. Exclusive: Drivezy sues Yamaha for starting parallel biz ..., entrackr.com, Oct 19, 20
2. Drivezy to liquidate its fleet as demand falls amid virus outbreak, mint, 2020-07-28
5. Google for Startups Accelerator: India, Google for Startup
6. on-demand services | TechCrunch, TechCrunch
7. A study on emerging trends in Indian startup ecosystem, emerald.com, Jan 7, 202
8. Drivezy, India's vehicle-sharing startup, is raising $100M+ at a $400M valuation, eyes US expansion | TechCrunch, TechCrunch, 2019-03-13
9. Car-Sharing Startup Drivezy Raises $100M For US Expansion | PYMNTS.com, PYMNTS.com, 2019-03-13
10. Drivezy to raise funds but at lower valuation, mint, 2020-09-22
11. Drivezy in final stages of talks to raise $60 million in Series C funding, The News Minute, Dec 17, 20
12. Funding Setbacks, M&A Rejections And Pivots: Drivezy’s Redemption Song, Inc42 Media, 2020-03-30
13. Drivezy sues Yamaha for launching a competing business and terminating the transaction | Startup Story, Startup Story, 2022-10-20
14. Drivezy sues Yamaha For allegedly embezzling its IP after dropping a merger deal, The Financial Express, Oct 20, 20
16. ashwarya singh News and Updates from The Economic Times - Page 1, The Economic Times
17. Drivezy: Founder, Leadership & Team, wellfound.com
18. Ashwarya Singh, Speaker at One Globe Forum, 8th edition One Globe Forum will focus on Entrepreneurship, Economic Growth, Technology, Education and Skill Development, oneglobeforum.com

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