Digital supply chain startup Wiz Freight's FY23 revenue jumps 280% to Rs 1,243 crore

Digital supply chain startup Wiz Freight has reported a 280% jump in its revenue to Rs 1,243 crore in FY23 from Rs 327 crore in FY22, Entrackr reported. Despite this explosive growth, the startup faced increased costs, resulting in a loss of Rs 90 crore in FY23, in sharp contrast to a profit of Rs 8 crore in FY22.

Founded in 2020 by Ramkumar Govindarajan and Ramkumar Ramachandran, Wiz Freight specializes in providing a digital platform for exporters and importers to manage their cross-border shipments.

Revenue streams and operating costs

The company's revenue primarily stems from freight forwarding and warehousing services. In FY23, it also earned Rs 18 crore in interest income, bringing its total income to Rs 1,261 crore.

However, Wiz Freight's operating costs have surged, with direct costs, including freight and warehousing charges, accounting for 82% of total expenses. These costs alone increased 3.8 times to Rs 1,103 crore in FY23 from Rs 288 crore in FY22, contributing significantly to the firm's financial loss.

Strategic losses for future expansion

Wiz Freight's ambitious expansion efforts have led to significant financial losses, with a reported loss of Rs 90 crore in FY23. The company's Return on Capital Employed (ROCE) and EBITDA margin stood at -21% and -2.3%, respectively, indicating that it spent Rs 1.08 to earn a rupee in FY23.

The strategic decision to accept losses in the short term is aligned with the company's goal of scaling operations and securing a larger market share.

Funding and investors 

In January 2024, Wiz Freight raised Rs 125 crore (approximately $15 million) in a Series B funding round led by Japan-based SBI Investment and other investors, including Tiger Global, NIPPON EXPRESS HOLDINGS, Axilor Technologies Fund, Foundamental, Arali Investments, Unikon Shipping Ventures, and several family offices.

To date, The startup has raised approximately $55 million. Tiger Global is the largest external stakeholder, with a 14.15% share, followed by Axilor and Foundamental.