INDIA – Swiggy, the Bengaluru-based online food delivery platform, has raised US$113 million as part of its Series I funding round led by its largest existing investor Prosus Ventures, formerly known as Naspers Ventures and Food.
The funding round also saw the participation of other existing investors Hadley Harbour Master Investments and Meituan. According to an ET Retail report, Prosus- which controls over 40% stake in the Swiggy – pumped about US$100m in the round.
The new funding places the startup at a million at a close to US$3.3 billion valuation. In December 2018, the startup raised a historic US$1billion round, which was also led by Naspers, China’s Tencent, Hillhouse Capital, and Wellington Management.
The startup has raised about US$1.57 billion to date. Sriharsha Majety, co-founder and chief executive of Swiggy, said the startup will use the fresh capital to invest in “new lines of business” such as cloud kitchens and delivery beyond food items.
This expansion, according to Sriharsha, will enable the company and get on a “sustainable path to profitability.”
“We are laser focussed on continuing to execute on our vision while building a sustainable path to profitability,” Sriharsha said
“Over the last couple of years at Swiggy, we have made strong strides in our vision of delivering unparalleled convenience to urban consumers, and in building a fundamentally strong and enduring business while keeping the consumer at the core.”
The Bangalore-headquartered firm, which is operational in 520 cities, said it has witnessed a 2.5x growth in the volume of transactions in the past year. Its restaurant partners base has also grown to 160,000 and more than 10,000 are joining the platform each month.
Larry Illg, chief executive of Prosus Ventures and Food, said: “Swiggy continues to exhibit strong execution and a steadfast commitment to delivering the best service to consumers and has one of the best operational teams in food delivery globally.
“We are confident Swiggy will continue on a path to earn a significant place in the daily lives of Indians.”
The funding will also enable the startup to battle its archaic rival, Zomato which recently acquired Uber Eats business in India and raised USS$150 million in funding from existing investor Ant Financial – in a deal which now values Zomato at over US$3 billion.
However, analysts say that Swiggy will need a large war chest to build a consumer-facing logistics network as it expands its footprint across the country, especially in smaller towns and cities and in parallel also scales up its services beyond food delivery.