Indian food delivery start-up Swiggy gets dollar 1.25 bn funding |
India`s Food delivery startup, Swiggy has said that it has raised $1.25 billion from investors, including SoftBank and Prosus, nearly matching the funds raised by rival Zomato in an initial public offering, as the two companies battle to dominate India`s food delivery market. The fundraising announced on 20th July valued Swiggy at $ 5.5 billion, an increase of more than 50% from the $3.6 billion it was valued in April 2020. Existing investors, including Accel Partners and Wellington Management, also took part in the fundraising. New investors in the round include Qatar Investment Authority, Falcon Edge Capital, Amansa Capital, Goldman Sachs, Think Investments and Carmignac. Swiggy`s chief rival Zomato saw its IPO subscribed around 40 times, indicating investor enthusiasm to back the money-losing food delivery startup. The share sale valued Zomato at $8 billion. Other companies that recently completed fundraisings include Flipkart, which raised a record $3.6 billion during the second week of July 2021. The business and potential of food delivery in India is massive. Investors are expected to continue to invest aggressively into growing this category. Swiggy`s biggest investments will be in their non-food businesses that have witnessed tremendous growth in a short span. Earlier this month, the Competition Commission of India (CCI) approved SoftBank`s $450 million investment into Swiggy`s parent Bundl Technologies. According to Swiggy, the fundraising will help the company execute its multi-year strategy of growing beyond the core food delivery business and build other revenue models. Over the past year, Swiggy diversified into pick-up-and-drop service, Swiggy Genie, and the e-grocery delivery segment with its Instamart offering. It also operates subscription-based grocery delivery service, SuprDaily. Swiggy`s new bets into non-food delivery segments has improved investor confidence, leading to the current investment. Through the latest investment, Swiggy will further enhance its capabilities across technology and artificial intelligence while strengthening teams across engineering, product, data science and analytics. It will also utilize the capital to build supply chains for its newer initiatives.
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