Swiggy acquires the title of the second-most valuable startup in India after a double in its valuation
Swiggy is an online food delivery platform that connects restaurants and food stalls to consumers. Founded in 2014 by BITS Pilani graduates Sriharsha Majety and Nandan Reddy, and IIT Kharagpur graduate Rahul Jaimini in Bengaluru, Swiggy has surpassed Zomato, becoming the second-most valuable startup in India after the ed-tech giant Byju’s.
Swiggy, backed by Invesco, an Atlanta-based investment company, raised $700 million in the new funding round.
This new funding brought the popular startup as one of the companies in India to become a decacorn at a valuation of around $10.7 billion. Decacorn is the term used for companies that value above $10 billion. India is home to other decacorns like Byju’s ($21 billion, 2022), Flipkart ($11 billion, 2014-15), Oyo ($10 billion, 2019) and Paytm ($16 billion, 2019).
In July 2021, SoftBank Vision Fund had invested $1.25 billion in Swiggy, which had raised its valuation to $5.5 billion. Swiggy also revealed that the valuation of its delivery service system had doubled in Global Order Value (GOV) in the last year.
Instamart: Reason behind Swiggy’s decacorn title
This current funding will also be advantageous in the growth of Swiggy’s core platform and came after the massive success of Instamart and when the consumer demand for the service accelerated.
Swiggy had launched Instamart in August 2020, a quick grocery delivery service, which became popular during the pandemic.
Instamart is like an online convenience store that provides day-to-day products like vegetables, fruits, dairy, grocery and even instant food products. It gained popularity in the lockdown. “In 17 months, Instamart achieved a GMV (gross merchandise value) double of that gained by Swiggy’s delivery service in 40 months”, noted Majety, CEO and co-founder of Swiggy. He commented that the company aims to continue to invest in its people, products and partners.
He also said, “Our goal is to make Swiggy a platform that 100 million consumers can use 15 times a month.” Magety also remarked, “We will double down on this to build more categories in line with our mission of offering unparalleled convenience to Indian consumers.”
Instamart is available in 19 cities. It is set to reach a $1 billion annual GMV rate in the next three quarters. The newest fund will help grow and strengthen Instamart. It will also arm the food delivery startup against Zomato, Ola Foods, Amazon and Flipkart. The company said, “Instamart is well-positioned to continue to lead the emerging quick commerce grocery space.”
According to experts
According to experts, India’s quick commerce, set to grow to $5 billion by 2025, has gained the attention of many companies like – Zepto, Zomato-backed Blinkit, Reliance-backed Dunzo and Tata-backed Big Basket.
Many investors took part in this latest round. Among them, existing investors – Alpha Wave Global (formerly Falcon Edge Capital), ARK Impact, Qatar Investment Authority and Prosus, Swiggy’s long-term investor.
Other investors were Smile Group, Segantii Capital, Axis Growth Avenues, Sixteenth Street Capital, Sumeru Ventures, IIFL AMC Late-Stage Tech Fund, Baron Capital Group and Kotak.
Justin Leverenz, the chief investment officer at Invesco Developing Markets Funds, remarked, “As long-term investors, the Invesco Developing Markets Fund seeks opportunities in the best companies in the world, led by world-class management teams that have the potential for long-term structural growth.” He said Swiggy is the epitome of such an investment.
Published By – Ranjit Gohite
Edited By – Mahi Gupta
