According to the company, the funds will be used for building and strengthening the technology capabilities, bolstering the robust supply chain, investing in mobile technology and developing talent pool.
Flipkart co-founder and CEO Sachin Bansal while addressing the media said the company could become profitable today if it wished so but the focus was on investing in growth to tap a wider market that is set to reach $76 billion by 2020.
This investment reflects the potential of e-commerce in India. With this investment, we can now take Flipkart to the next level and will enable us to reach our goal of $1 billion in transactions by 2015, Sachin Bansal said, adding that the company does transactions valued at around R3,000 crore per year.
South Africa-based Naspers is a leading multinational group of media and e-commerce platforms, listed on the Johannesburg stock exchange, while Iconiq Capital is a global multi-family firm, headquartered in San Francisco.
The e-commerce sector, which is bleeding in India, has also seen global leader Amazon.com entering the Indian market this year. Flipkart, which has around 6,000 employees, has itself seen some changes with the company gradually shifting on to the market place model away from the inventory-based model it had adopted in 2007, when it started. According to Bansal, though an IPO is an eventuality, it is a bit premature to talk about it.
Flipkart said it has 10 lakh daily visitors. The firm, which entered categories like apparel, footwear, toys, accessories, sports and fitness, eBooks last year, plans to expand to tier 1 and tier 2 cities.
Binny Bansal, co-founder and COO of Flipkart, said, The growth potential is enormous and our investors share this vision. Each round of funding has come at a strategic point during our growth. The firm has currently 500 sellers.
Last year, the firm had acquired Gurgaon-based startup Letsbuy.com. The acquisition was funded through a combination of cash and equity.
The company recently exited big electronic items and digital music and attributed the exit to lack of customer traction. We exited because we could not give the experience we promised. Our aim is to sell everything and we are bullish on the new product categories we have entered, Binny Bansal said.
E-commerce in the country forms 6-7% of the organised retail market. The e-commerce market in India, which includes all financial transactions on the internet, is estimated to be valued at $10 billion in 2012. According to data from Technopak, e-commerce is projected to grow at a CAGR of 45%.