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Mukesh Ambani’s Investment Transforms Dunzo Amid Financial Challenges

Dunzo investment by Mukesh Ambani

Mukesh Ambani, the Indian business tycoon with net worth of Rs 9.6 lac crore as per Forbes, has largely contributed to the startup economy by helping startups through strategic investments. One of his investments is in Dunzo, a hyperlocal delivery company that went on to become an enterprise of Rs 6,400 crores after being shown interest by this big entrepreneur.

The history of Dunzo

Dunzo came into existence due to the vision of Kabeer Biswas, who has a strong record of achievements in tech entrepreneurship. In his previous venture of Hoppr he created an e-commerce app which was later merged into the Hike brand. He along with 3 of his associates, co-founders Ankur Agarwal, Dalvir Suri, and Mukund Jha, used his experience in computer science and product development (electronic major as well as electronic consumer brand communication) which include positions at Airtel, Videocon and Y2CF, to start Dunzo.

The genesis of Dunzo was unconventional. Biswas initially managed customer requests through a WhatsApp group. As demand surged, he evolved this concept into a full-fledged app-based service. Dunzo now operates in several major Indian cities, including Bengaluru, Mumbai, Delhi, Gurgaon, Pune, Chennai, Hyderabad, and Jaipur, delivering groceries, essentials, and other commodities—beating competitors like Blinkit and Swiggy Instamart to market.

The latest investment story

Mukesh Ambani’s Reliance Retail Ventures Ltd. invested Rs 2004 crores (approximately 240 million dollars) in Dunzo. Hence, it became Dunzo’s biggest shareholder by holding a 25.8% share. Furthermore, Dunzo had recently bagged Rs 75 crore from Google, making it the first Indian start-up to receive direct funding from this tech giant. Kabeer Biswas’ educational background includes an Engineering bachelor’s degree from Mumbai University, and then he attended NMIMS (Narsee Monjee Institute of Management Studies), where he got an MBA.

Despite its growth and notable investments, Dunzo is currently grappling with financial challenges. News18 reports that the company is experiencing a cash crunch, leading to delayed salaries, multiple rounds of layoffs, pay cuts, and a significant loss of Rs 1,800 crore in 2023. Consequently, Dunzo’s valuation plummeted to $200 million (approximately Rs 1,670 crore) in 2023, according to DNA and News18.

Ambani’s investment has undeniably accelerated Dunzo’s expansion and market penetration, but the startup must navigate these financial hurdles to sustain its operations and future growth.

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