SoftBank, Tencent and Flipkart are looking to invest in an Indian based Startup “Swiggy”
Swiggy is a food ordering and delivering startup which was started in August 2014 by Shriharsha Majtey, Nandan Reddy, and Rahul Jaimini in Bengaluru currently, they are functional in over ten cities and have tie-ups with 20,000 restaurants. The company has raised a $155.5 Mn funding till now.
Japanese conglomerate SoftBank is apparently set up for a $200 Mn-$250 Mn investment in Swiggy. With this, SoftBank has collaborated with Flipkart and China-headquartered Tencent, both of which are holding conversations with the Naspers-endorsed online food delivery system for a potential investment.
According to report, SoftBank is looking forward to grabbing a minority stake in Swiggy, in exchange for $200 Mn-$250 Mn. If successful, the investment may likely take place at a pre-money valuation of $600 Mn-$650 Mn.
A spokesperson for Swiggy told, “Swiggy garners continuous interest from investors due to our market leadership position, strong growth and financial performance. We stay focused on delivering exceptional value to consumers and will comment fundraiser at the opportune time.
“SoftBank, however, declined to touch upon the development, calling it a “speculation“.
Chinese Internet giant Tencent is also reportedly looking to co-invest in the round, in addition to pouring yet another $50 Mn into Swiggy. This, according to sources, would take Tencent’s proposed investment in the online delivery startup to around $100 Mn.
Joining the trend is Jack port Ma-led Alibaba, which also desires an interest in endorsing Swiggy through its payments arm Ant Financial. Interestingly, the e-commerce behemoth happens to be engaged in discussions with Swiggy’s major competitor, Zomato, for a proposed $200 Mn investment. If fruitful, the round would value Zomato at about $1.1 Bn.
Most recently, in the third week of November, The Ken reported that Flipkart was preparing for a possible infusion of $50 Mn in Swiggy. Tencent, whose portfolio includes organizations like Practo, Ola, Flipkart and Hike, May also follow the investment round with Flipkart in the Bengaluru-based startup, according to sources.
Why investing in Swiggy would be fruitful?
The major investor of Swiggy are; Naspers, Accel Partners, SAIF Partners, Bessemer Venture Partners, Harmony Partners, Norwest Venture Partners, DST Global and RB Investments.
In May this year, the company brought up $80 Mn in a round led by Naspers at an estimated valuation of $400 Mn. The round also saw involvement from existing investors Accel India, SAIF Partners, Bessemer Venture Companions, Harmony Lovers and Norwest Venture Partners. Before in Sept 2016, Swiggy found $15 Mn (INR 100 Cr) Series D funding led by US-based venture capital firm Bessemer Venture Partners and other existing investors.
The reported income of the company is over $3.6 Mn (INR 23.6 Cr) and loss of about $21.3 Mn (INR 137.18 Cr) for FY2015-16, as per regulatory filings with RoC. They have since witnessed a nearly 6x leap in income during FY17. After looking at the growth and the numbers it seems that the investment may pay back a big fortune for the investors and to the company.