Swiggy gets $800M at nearly $5B valuation in latest fundraising from Goldman Sachs, Falcon Edge, others

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April 5, 2021 8:58 PM

The fresh investment in Swiggy has come from a new set of investors including Falcon Edge Capital, Amansa Capital, Think Investments, Carmignac, and Goldman Sachs along with existing investors Prosus and Accel.

The latest round has taken the total funding amount raised by Swiggy to $2.22 billion. (Image: Dhiraj Singh/Bloomberg)

Weeks after Zomato raised $250 million in its latest fundraising, arch-rival Swiggy has now closed a massive $800 million round. The fresh investment has come from a new set of investors including Falcon Edge Capital, Amansa Capital, Think Investments, Carmignac, and Goldman Sachs along with existing investors Prosus and Accel, according to an internal email sent by Swiggy’s Co-founder Sriharsha Majety to employees on Monday. A copy of the email was accessed by Financial Express Online. The new round has valued the company close to $5 billion, a source aware of the fundraise told Financial Express Online.

The fundraise was also very heavily oversubscribed given the very positive investor sentiment towards Swiggy, Majety said in the email. “We’ve managed to drive a strong recovery in the food delivery business with a very clear path to profitability. The food delivery business is the strongest it’s ever been…In addition, some of our new bets like Instamart are showing amazing promise,” Majety added.

The latest round has taken the total funding amount raised by Swiggy to $2.22 billion since its launch in 2014. Swiggy had last raised $158 million in February last year at a valuation of $3.65 billion. “This fundraising gives us a lot more firepower than the planned investments for our current business lines…we will continue to seed/experiment new offerings for the future that may be ready for investment later,” said Majety.

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The company had a 127.8 per cent jump in its revenue for FY20 along with widening net losses and expenses by 65.8 per cent and 87.5 per cent respectively on a consolidated basis. Backed by Tencent, DST Global, and others, Swiggy saw its total income rise from Rs 1,297.3 crore in FY19 to Rs 2,955.6 crore in FY20, according to Tofler’s data. Swiggy’s losses for FY20 stood at Rs 3,920.4 crore in comparison to Rs 2,363.6 crore for FY19. The business has grown 85 per cent with addition of more than 1 lakh restaurants with an active delivery fleet of over 200K, Swiggy had said in its regulatory filing. It had launched in 405 new cities in 2020.

Comparing to China’s food delivery company Meituan, which had around 500 million transacting users last year, Majety said that the next 10-15 years offer once-in-a-lifetime opportunity for companies like Swiggy as the Indian middle class expands and our target segment for convenience grows to 500 million users over this period.

Importantly, Zomato has reportedly been preparing itself for an IPO in the first half of 2021. The company witnessed a staggering 160.6 per cent jump in its losses for the financial year (FY) 2019-20 while its revenues increased 98 per cent from the preceding FY. Its losses mounted from Rs 940 crore in FY19 to Rs 2,451 crore while its revenues were up from Rs 1,255 crore in FY19 to Rs 2,485 crore in FY20.

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