Dunzo has raised $40 million (roughly Rs. 290 crores) from existing investor Google and others after seeing a surge in usage during the COVID-19 pandemic.
As many Indians stayed indoors for much of 2020 because of the health crisis, Dunzo and food-delivery apps Zomato and Swiggy recorded a fresh surge in popularity. Naspers-backed Swiggy also runs a hyperlocal courier service.
"This capital stems from a year of robust growth amidst the pandemic," Dunzo said in a statement. "As cities reopen, (Dunzo) continues to see strong growth across user segments."
Besides Google, Lightbox, Evolvence, Hana Financial Investment, LGT Lightstone Aspada, and Alteria also participated in the fundraising round, the Bengaluru-based company added.
Dunzo allows users to order groceries and other essential items from nearby stores as well as run pick-up and drop errands within the eight cities it operates in.
"As merchants go digital, Dunzo is helping small businesses in their digital transformation journey," said Caesar Sengupta, vice president at Google, which has set aside $10 billion (roughly Rs. 73,100 crores) for digital investments in India over five to seven years.