Amid the Covid-19 pandemic, as healthtech startups look to tap into a great opportunity and crack open the market, Bengaluru-based epharmacy Medlife is looking to secure capital to shore up its operations.
According to the ministry of corporate affairs filings accessed by Inc42, the company has passed a special resolution on March 18 to avail credit facilities of up to INR 155 Cr from Hero Fincorp, with Hero Fincorp having the option of converting the debt into equity or equity-linked convertible securities in Medlife.
Over the past two months, Medlife has also passed resolutions to issue optionally convertible redeemable preference shares and give loan/guarantee/security for up to INR 500 Cr.
The resolutions come after Medlife raised $15.5 Mn (INR 110 Cr) from Wilson Global Opportunities Fund in a debt funding round in December 2019. Medlife said it plans to use the funds towards the development of technology, marketing, employee expenses and to support the future growth of the company.
Founded in 2014, the company was started by Tushar Kumar and Prashant Singh. In August 2019, ex-Myntra CEO Ananth Narayanan joined Medlife as the cofounder and CEO. The company started its journey as an inventory-led epharmacy company which also helps doctors digitally manage and store patients records.
In an earlier interaction with Inc42, Naryanan had said that the company is planning to raise external funding to continue the next stage of growth, where the company was looking to raise about $150 Mn over the next six months.
Currently, the company claims to fulfil over 30K deliveries every day across 29 states and 20K postal codes.
As of March 2019, the company claimed to have crossed INR 1K Cr plus run rate. In FY20, it is expected to achieve overall sales of INR 1.5K Cr with an exit run rate of INR 2K Cr. CEO Narayanan had said that in the next 12 to 18 months, the company will achieve breakeven in terms of unit economics.
In terms of mergers and acquisitions, the company has made quite a few investments in the recent past. Narayanan had earlier told us that for acquisitions, the company focuses on the capability and the customers it is acquiring.
- In May 2019, Medlife acquired Bengaluru-based medicine delivery pharmacy startup Myra Medicines for an undisclosed amount
- In February 2019, it acquired a digital healthcare platform and a ‘diagnostics at home’ services startup called Medlabz
- In 2018, the company acquired Mumbai-based EClinic24/7
According to DataLabs by Inc42, there are over 4800 healthtech startups in India till 2018. In the ongoing national lockdown, epharmacies were declared an essential service leading to the majority of Indians depending on platforms such as 1mg, Medlife, NetMeds, Pharmeasy and others for buying medicines and for other services.
Update: May 1, 2020| 14:40 PM
After the story was published, a Medlife spokesperson told us, “We are raising Rs 155 crore from HeroFincorp with the option of converting into equity or equity linked convertible securities over the next three years. While there was a plan for this funding to go into future growth of the company, the immediate impetus has come from the massive surge in demand in the current COVID-19 situation. This requires immediate expansion and ramping up of frontline and backend facilities to meet the demand. We will raise more funds if required to meet the needs of our customers who are now banking on us to deliver critical medicines as well as a continuous lifeline for their regular medicine, testing and consultation needs.”