Food delivery platform Swiggy on Tuesday announced that it has closed a $1.25-billion funding round led by SoftBank Vision Fund 2 and its long-term investor Prosus.
After the funding, Swiggy will be valued at around $5.5 billion (Rs 41,125 crore). The development comes at a time rival Zomato is set to list on the bourses with a valuation of Rs 64,365 crore. Its initial public offering (IPO), which concluded last week, was subscribed over 38 times.
Indian start-ups continue to see strong interest from private equity players and have raised $12 billion in the first six months of this calendar year, according to Venture Intelligence. For Swiggy, the funding will give it more firepower to take on Zomato and grow its non-food business.
A statement from Swiggy said this will be the first investment in the Indian food delivery category by SoftBank Vision Fund 2. Besides Prosus, other existing investors such as Accel Partners and Wellington Management participated in the funding round.
Swiggy added that the latest fundraise was heavily subscribed following strong interest from investors and it follows the start-up’s rapid recovery from the impact of Covid-19 and subsequent growth in 2020-21.
“The participation of some of the most visionary global investors is a huge vote of confidence in Swiggy’s mission and ability to build an enduring and iconic company out of India,’’ Swiggy CEO Sriharsha Majety said while commenting on the development.
Majety added that the scope of food delivery in India is massive and over the next few years, Swiggy will continue to invest aggressively in growing this category. “Our biggest investments will be in our non-food businesses that have witnessed tremendous consumer love and growth in a short span, especially in the past 15 months of the pandemic,” he said.
Swiggy has diversified from food delivery to pick-up and drop through its “Swiggy Genie” facility where customers can get items such as over-the-counter medicines, home food, documents and items from the supermarket, stationery and pet shops. It is also bullish on e-grocery delivery from its Instamart offering
Speaking to a television channel, the Swiggy CEO said the company was also considering an IPO but added that there was nothing “actionable” just now.
The latest round of investment is expected to accelerate Swiggy’s multi-year strategy of growing its core food delivery business and building new food and non-food segments in 2021 and beyond. The company plans to enhance its capabilities in technology and artificial intelligence and strengthen teams across engineering, product, data science and analytics.