Bolt, Estonia ride-hailing startup, has secured $711 million or €628 million funds from investors to expand its transportation and food delivery operations. The new funding pushes Bolt’s valuation to $8.4 billion or €7.4 billion from over $4.5 million or €4 billion it was valued in August 2020 when it raised $679 million or €600 million in funding.
According to the company, the secured fund will be used to expand operations to new cities/countries, onboard more customers on its super app and new line businesses such as its 15 minutes grocery delivery options.
Participants of the fund round are, Sequoia Capital, Fidelity Management and Research Company LLC, Whale Rock, Owl Rock (a division of Blue Owl), D1, G Squared, Tekne, Ghisallo, and other unnamed backers investors.
Markus Villig, the founder and CEO of Bolt in an interview, said, “we are expanding all the five product lines extremely quickly, developing product R&D and rolling out in new cities”. He affirmed that all the company’s business units are growing, the ride-hailing business “is seeing double-digit growth,” and the new businesses are growing even faster.
Compared to 75 million customers reported in August, Bolt now has more than 100 million customers in over 400 cities in 49 countries subscribed to its services.
Speaking on the challenges the company faced at the advent of COVID-19, Markus said there were “short-term fluctuations” in demand, however, Bolt launched a strategy to attract and keep drivers by focusing on better commission between 10 percent and 20 percent better than competitors.
“There is a massive lack of supply on these platforms, so we have focused on taking the most partner-friendly lowest commission,” he said.
Speaking on the company’s expansion to developed countries, Markus said, “We started off in Eastern Europe and Africa because those markets had a bigger need. They had lower car ownership, higher unemployment [making for a market with many freelance drivers], It made sense. But now we’ve learned that this model works everywhere, and it’s actually easier to grow in Western Europe because they are developed markets. We found if you can make this model work in really cheap, frugal markets, then once you go to London or Stockholm, it’s materially easier. And the unit economics are definitely better because the prices are higher.”
Andrew Reed, a partner at Sequoia said, “We’re excited to deepen our partnership with Markus and Bolt to further their mission to make urban travel affordable, sustainable and safe. At Sequoia, we believe in the global potential for technology and entrepreneurship and have been inspired by Bolt’s growth from Tallinn, Estonia to over 400 cities and 100 million customers across Europe and Africa. We’re eager to help them expand their footprint, increase their product offering and improve the quality of life in cities for the long term.”
