Bykea, a ride-hailing and parcel delivery startup based in Pakistan, has received up to $5 million in capital commitments from Middle East Venture Partners (MEVP) for its upcoming Series B round.
According to Bykea CEO Muneeb Maayr, the firm is targeting to raise $15 million for its Series B round by early 2020. It is engaged in active conversations with prospective investors from Pakistan and around the world.
Bykea last closed its $5.7-million Series A round in April, with $2 million from MEVP, $1.2 million from Sarmayacar, a Pakistan-focused venture capital firm, and $2.5 million from a Vietnamese investor. Its previous investors include Pakistani investment companies Ithaca Capital and JS Capital as well as angel investors such as Jonas Eichhorst.
According to Bykea, the platform has over 200,000 motorbike owners serving two million users across Karachi, Rawalpindi, Islamabad, and Lahore. The platform operates mainly in Urdu through voice notes, and follows Indonesia’s Gojek model, tapping on its motorbike drivers to deliver parcels to its users.
Bykea was facing stiff competition in the country until US ride-hailing giant Uber announced plans to acquire its Middle Eastern counterpart, Careem, for $3.1 billion in March. Since then, Maayr said the company will be able to breathe easy until the acquisition finalises in Q1 2020.
Maayr is bullish about Bykea’s prospects, sharing that the company has already broken even in Karachi, Pakistan’s most populous city. It has also been careful not to enter segments which will lead it to a “race to the bottom”, noting that it does not want to replicate the relentless cash-burning seen in companies like Uber and WeWork.
In coming months, Bykea will roll out new services in B2B logistics and cash-to-digital payments. It is open to other services like food delivery down the line as well.
Bykea was founded by Muneeb Maayr, co-founder of Daraz, a Rocket Internet-backed e-commerce site. In May 2018, Daraz was sold to Chinese internet giant Alibaba for an undisclosed amount, making it one of the earliest exits in Pakistan.
Pakistan is one of Asia’s many frontier markets that have begun to appear on the radar of foreign investors in recent months. Other Pakistani startups that have raised overseas capital include Airlift, a transportation startup backed by Fatima Gobi Ventures, and EasyPaisa, a digital wallet that is 45%-controlled by Alibaba’s Ant Financial.