ProRata Cars Startup Ideas

ProRata Cars is a platform that links people within a 10-kilometer radius, making it easier for co-owner groups to create. People may now take advantage of the advantages of automobile ownership without the responsibilities of single-ownership by collaborating with other community members. According to their concept, one should own one or two cars for daily use and commuting, and two or three more cars for leisure and lifestyle purposes. They operate to create a trustworthy platform where costs and use are distributed according to need. Even weekends and vacations are allocated equitably thanks to technology in their clever, user-friendly smartphone application. All expenditures, including those incurred due to accidents, traffic violations, and delays, are assigned to the appropriate co-owner on our mobile application. They pitched their business model in the 45th episode of Shark Tank India Season 3.

Company Details of ProRata Cars Startup Ideas

ProRata Cars. has the Company named PRORATA SERVICE TECH LLP with a COMPANY incorporation date of 3 January 2023. This Company is registered in Kolkata, India, with an obligation to contribute ₹1 Lakhs which aims to connect nearby people with similar interests to form a Co-Owner Community, where each co-owner can pay their shares to collectively own a brand new car.

Ownership of ProRata Cars Startup ideas

PRORATA CARS was co-founded by Sanjeev Kumar Jain and Rashmi Jain. Sanjeev Jain is a charted accountant and performed the role of Chief Executive Officer (CEO) ofthe company with the experience to run a business in prior which was into the Real Estate Community Platform. He owns the company with an equity of 90% and Rasmi Jain holds 10% of the company’s Possession.

The business model of ProRata Cars Handicraft Startup ideas

Prorata Cars is an app which aims to target these 38 Million car owner who want to upgrade their lifestyle with premium, luxury and off-road cars at just 8.33% only by using a commercial strategy of charging a small amount as verification and they are a tech-based company that charges for their services to generate profits.

Products and Services of ProRata Cars Startup

PRORATA CARS is an application-based platform providing fractional car ownership where a user can Co-Own their dream car by paying 8.33% of the total cost. The Pro-Rata app algorithm connects nearby people with similar interests to form a Co-Owner Community, where each co-owner can pay their shares to collectively own a brand new car Detailed information about their services can be found at: https://www.proratacar.com/.

Business valuation of ProRata Cars Handicraft Startup ideas

ProRata Cars presented their pitch in Shark Tank India seeking an investment of ₹1 Cr for equity of 2% at a business valuation of ₹50 Cr

• Aman: He backdropped his interest in the business at the point of knowing that business is in the pre-revenue stage. He also stated that the founder is yet to know about their operational challenges. He believed that rather than opting for this model, he would choose already available conventional methods of renting a car or taking a taxi, as a consumer. Hence, he didn’t invest.
• Namita: She didn’t believe that the audience market which the founder is willing to cater is suitable for their purpose as she believes that Indians do not focus on such kind of planning and organization. Hence, she didn’tinvest.
• Peeyush: He believed that there are many businesses that out of nowhere based on the strong concept and thinking of the founders and hence he made a collective offer of ₹50 Lakhs for the equity of 10% with ₹50 Lakhs Debt at 14% Interest with Anupam
• Vineeta: Vineeta liked the idea of the business which was the first of its kind in the world but was not sure about the future scalability if the business has the potential market size to grow or not.
• Anupam: He liked the concept of business and the thought procedure of the founders that despite of business being in the early stage and unidentified operational challenges, he gave the founder a collective offer with Shark Peeyush of ₹50 Lakhs for the equity of 10% with ₹50 Lakhs Debt at 14% Interest.

After extensive negotiations with Sharks, the founders were able to secure a deal of ₹50 Lakhs for the equity of 10% with ₹50 Lakhs Debt at 14% Interest with Shark Anupam and Peeyush.

Analysis of Shark Decisions of ProRata Cars Handicraft Startup Ideas

The Sharks' decisions reflect several key considerations for ProRata Cars.:

• Valuation Concerns: Namita brought up a concern over the high valuation of the business in such an early-stage
• Growth Opportunity: Vineeta pointed out the situation of scalability and growth opportunity which was not visible seeing the current circumstances.

Some key strengths and weaknesses of ProRata Cars Handicraft startup ideas:

Strengths:

• Asset Light Model:Adopting a business strategy where a company minimizes the ownership of physical assets and relies on outsourcing or leasing instead, is the major USP of their business.
• Early Mover Advantage: Vineeta pointed out the fact that this business model is one of the first in the world of his kind, which can be of great advantage. Hence, she didn’t invest.

Weaknesses:

• Early Stage: Aman pointed out the problem of business being in the pre-revenue stage because of which the founder will not be able to see their upcoming operational challenges.
• Small Market Size: Namita and Vineeta stated that this business model has very little chance of achieving scalability in India as the market is not that organized in India to use such kind of application.
• Unreasonable valuation: Being the business in an early stage, the valuation that which founders are presenting that too based on raising funds from a non-institutional source was not a good move to play.

Future of ProRata Cars Handicraft Startup Ideas

The future of PRORATA CARS rests on the founders if they can cater to the audience which they are willing and present in front of the Sharks as the major concern of this business model is to develop and cater to the right the market size in this country for such an organized requiring model.

Conclusion

Following a pitch, PRORATA CARS, was able to attract the interest of Sharks into the business, but throughout the pitch, after pointing out the key highlights of the business model, Sharks were concerned about the valuation of the business and its growth trajectory but still, they were able to secure a collaborative deal with Shark Anupam and Peeyush of ₹50 Lakhs for the equity of 10% with ₹50 Lakhs Debt at 14% Interest through their strong business ideation.

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