Flipkart-backed logistics startup Shadowfax Technologies said it is on track to achieve Ebitda (earnings before interest, taxes, depreciation and amortization) profitability this financial year while it continues its expansion plans.
“We invested ahead of time in technology and network capabilities to deliver growth for last year as well as the next 12 months. These investments are now reaping benefits, leading to better fixed cost absorption and profits,” Praharsh Chandra, co-founder and chief business officer at Shadowfax said in an interview.
Shadowfax is currently nearing an investment deal with venture capital firm A91 Partners at a valuation of around $400 million, said a person close to the development.
“We are in advance stages of fund raise discussion with a few partners,” the company said.
Meanwhile, Shadowfax widened its net loss by 32% in the last financial year to ₹176 crore from ₹133 crore in the previous year because of a sharp increase in transport costs and employee expenses.
The company, however, more than doubled its operating revenue to ₹991 crore in FY22, from ₹464 crore in the previous fiscal, according to the latest filing with the Registrar of Companies (RoC).
Founded in 2015 by Abhishek Bansal, Vaibhav Khandelwal, Gaurav Jaithliya and Chandra, Shadowfax offers logistics services to several online-first brands.
The company offers 30-minute delivery to quick commerce, pharmacy and food delivery companies.
It also handles less time-bound logistics for e-commerce brands.
Besides Flipkart, Shadowfax is backed by investors such as Eight Roads Ventures, US investment firm NGP Capital, Qualcomm Ventures and Mirae Asset Naver Fund.
The company has a base of 125,000 monthly transacting delivery partners, fulfilling more than 1.5 million orders daily across more than 1,100 cities and towns.
It is currently catering to more than 50,000 merchants through intracity and intercity services, Chandra claimed.
“We plan to expand our services to 15,000 pin codes from the current coverage of 9,500 in a bid to cater to more clients and brands,” said Chandra. “The company will continue to invest in speed and omnichannel services in the coming year.”
In 2021, Shadowfax pivoted its business strategy to focus more on last-mile delivery. As part of the plan, the company closed non-core vertical businesses such as cloud kitchens, transportation solutions, and other asset-heavy businesses.
In October, Shadowfax partnered with Shiprocket to facilitate same-day and next-day deliveries for direct-to-consumer (D2C) brands. “We entered an express delivery partnership with Shiprocket and our business has grown almost 3 times since the initiation,” Chandra said.The company currently serves more than 170 D2C brands including McDonald’s, KFC, Apollo24*7, BigBasket, Decathlon, Ajio, Flipkart, Myntra, Hopscotch, Zomato, Swiggy, Meesho, and Pharmeasy.