Now that Uber has shown that a third-party ride-sharing and food delivery business can, in fact, be profitable, it seems the floodgates are open as money from big-time investors continues to pour into the space.
The latest beneficiary of the craze is Estonia-based rideshare and food delivery startup Bolt, which just ate up a $709 million raise that pushed its valuation to nearly $8.4 billion. The round was co-led by Sequoia Capital, Fidelity Management (NYSE: FIS) and Research Company LLC with participation from Whale Rock, Owl Rock, D1, G Squared and others.
“For decades, cities have been built for private cars rather than the people living and working in them,” said CEO and founder Markus Villig. “At Bolt, we think this approach is outdated, which is why our mission is to create cities for people, not cars.”
Bolt, one of Uber’s fiercest European competitors in several markets like London and Paris, will use the funding to expand into more geographies and build out its food delivery service, including by building “dark stores” in more cities to expand its 15-minute grocery delivery option, Bolt Market.
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“We are expanding all the five product lines extremely quickly, developing product R&D and rolling out in new cities,” Villig told Reuters.
Those product lines — ride hailing, car sharing, food delivery, grocery delivery and e-bike and e-scooter rentals — are wrapped up into one “super app,” similar to Uber or China’s Weibo. But having started out solely as a ride-sharing platform, Bolt’s success transmuting itself into a delivery service speaks to the opportunity for companies of all kinds to chart the global path ahead for delivery.
Bolt, like many ride-hailing services, was initially set back by COVID-19, with revenues dropping as much as 80% during 2020, but since then it’s been on a tear.
“All of our business units are growing,” Villig told TechCrunch, including its ride-hailing business, which he said doubled in 2021.
Bolt’s rebound year was capped off by a Series E funding round in August that netted the startup over $680 million and a valuation north of $4.5 billion. By that point, it had reached 75 million customers globally.
Now, though, Bolt boasts more than 100 million customers in 45 countries and over 400 cities across Europe and Africa, adding over 25 million customers in just four months. Villig attributes much of that growth to his company’s emphasis on sustainable mobility, through things like e-bikes and e-scooters, and cost effectiveness.
“In many cases we have been the driving force that actually lowers prices for consumers, so from day one we were really focused on being frugal,” he told Reuters. “We have been offering substantially lower prices than anybody else in the industry. … We expect this to continue.”
But another big part of Bolt’s success has been the diversification of its services, adding new verticals like food and grocery delivery to its core ride-hailing business.
The startup’s most recent addition to its product suite is Bolt Market, a 15-minute grocery delivery service launched last year that now operates in 10 countries out of a network of dark stores. Villig told CNBC that Bolt plans to spend “hundreds of millions” building out its grocery delivery business in the coming years, including using some of this week’s funding to build hundreds of new dark store locations.
But despite all of the excitement around the business, Villig is in no rush to take Bolt public.
“In the long term? Most likely, yes, we will go public,” he told CNBC, adding that “there’s no urgency for us at the moment.”