January 25, 2022 3:56:09 am
Two Bengaluru-based companies on Monday announced raising nearly a billion dollars in fresh funds — with ride-hailing firm Ola’s electric scooter spinoff, Ola Electric, raising $200 million and food-tech platform Swiggy announcing $700 million investment from marquee investors.
Swiggy, which has recently also ventured into the grocery delivery segment, raised $700 million in a round led by US-based investment fund Invesco. The round also saw participation from new investors such as Baron Capital Group, Sumeru Venture, IIFL AMC Late Stage Tech Fund, Kotak, Axis Growth Avenues AIF- I, Sixteenth Street Capital, Ghisallo, Smile Group and Segantii Capital. It also saw participation from Swiggy’s existing investors such as Alpha Wave Global, Qatar Investment Authority, and ARK Impact, and Prosus. The round valued Swiggy at $10.7 billion, catapulting it to the decacorn status — a unicorn valued at over $10 billion. At its last $1.25-billion fundraise in July last year, it was valued at $5.5 billion. Meanwhile, Swiggy’s key rival Zomato, which went public last year, has seen its market capitalisation plummet over the last few trading sessions to close at $9.6 billion on Monday.
In a statement, the company said that the latest fundraise will allow Swiggy to accelerate growth on its core platform (the food delivery segment), in addition to making investments in Instamart (the grocery delivery vertical).
“The GMV of our food delivery business achieved in 40 months, took Instamart just 17 months, demonstrating the platform benefits of Swiggy. We will double down on this to build more categories in line with our mission of offering unparalleled convenience to Indian consumers,” said Sriharsha Majety, CEO, Swiggy.
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Recently, Swiggy had announced investment of $700 million over a period of time in expanding its quick-commerce vertical Instamart — a segment that is witnessing intense competition from players such as Zepto, BlinkIt (formerly Grofers), and Dunzo, which is backed by Reliance Industries and Google.
Separately, Ola Electric, which claims to have built the world’s largest two-wheeler manufacturing facility, received $200 million from Tekne Private Ventures, Alpine Opportunity Fund, Edelweiss and others, valuing the firm at $5 billion. The company, which operates on a direct-to-consumer model has recently faced the fallout of customer complaints with regard to delivery delays, charger installations, etc, with its S1 range of scooters. Ola Electric’s last major fundraise of $200 million happened in September at a $3 billion valuation, while the parent company Ola Cabs, which is lining itself up for an initial public offering, raised $500 million in debt-financing from global institutional investors last month. Ola Electric, separately, had raised around $53 million in December in a financing round led by Temasek.
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