Exclusive: Zetwerk Raises INR 43 Cr Ahead Of IPO

SUMMARY

The company’s board passed a special resolution to raise the sum through issuance of 9,93,721 Series F3 CCPS at an issue price of INR 432.718 apiece

The funding round was co-led by Arc Investments and Oriental Biotech Limited

This comes amid reports that the B2B manufacturing unicorn is planning to file draft papers for its potential $500 Mn IPO in the next six months

B2B manufacturing unicorn Zetwerk has raised INR 43 Cr (around $5 Mn) in a funding round co-led by Arc Investments and Oriental Biotech Limited.

The company’s board passed a special resolution on February 25 to raise the sum through issuance of 9,93,721 Series F3 compulsorily convertible preference shares (Series F3 CCPS) at an issue price of INR 432.718 per share, as per its regulatory filings accessed by Inc42.

Arc Investments and Oriental Biotech infused INR 10 Cr each in the IPO-bound company, while Stargazer Fund-I invested INR 5 Cr. The remaining capital came from a group of angel investors.

Zetwerk did not say why it has raised the fresh capital. Inc42 has reached out to the company for comments. The story will be updated if and when we get a response.

The round appears to be ongoing, and Zetwerk is likely to raise more money in the coming days. Last month, sources told Inc42 that Zetwerk is in talks to raise $25 Mn to $30 Mn from Indian family offices and high-net-worth individuals.

The funding round will value the Bengaluru-based startup at $3.1 Bn and is aimed at increasing domestic ownership in the company, sources added.’’

In December last year, Zetwerk raised $70 Mn from Silicon Valley-based Khosla Ventures, and Indigo Airlines cofounder Rakesh Gangwal, among others. Overall, the startup secured a funding of $90 Mn in 2024.

Founded in 2018 by Srinath Ramakkrushnan, Amrit Acharya, Rahul Sharma, and Vishal Chaudhary, Zetwerk connects vendors and suppliers with manufacturing companies for procuring industrial machine components.

The startup joined the unicorn club in 2021. It has raised a total funding of over $700 Mn to date and counts the likes of Peak XV Partners, Lightspeed, Mars Growth Capital, among others, as its backers.

Last year, the startup also announced its foray into IT hardware and electric vehicle (EV) component manufacturing. Additionally, it set aside INR 1,000 Cr ($122 Mn) to invest in electronics manufacturing.

Zetwerk competes with the likes of Moglix, IPO-bound OfBusiness, among others.

The latest fundraise comes amid reports that Zetwerk is planning to file its draft red herring prospectus (DRHP) for an initial public offering (IPO) in the next six months. The company plans to raise $500 Mn through its public issue.

In October last year, Inc42 reported that the company had initiated talks with investment bankers like JP Morgan, Axis Capital, Goldman Sachs, Jefferies Financial Group, JM Financial, and Kotak Mahindra Bank for its upcoming IPO.

In January, reports said that the Peak XV-backed B2B marketplace has finalised six bankers – Axis Capital, Goldman Sachs Group, Jefferies Financial Group, JM Financial, JPMorgan Chase & Co and Kotak Mahindra Bank – to helm its potential $500 Mn IPO later this year.

This comes at a time when India has emerged as a hotbed for new-age tech IPOs even as the US market remains muted. More than a dozen startups went public last year and raised a record INR 29,070 Cr via their respective IPOs. Not just this, public listings also proved to be money makers for the early backers of these companies, with some VCs and PEs minting returns of over 30X.

The momentum is expected to continue this year with more than 20 new-age tech companies such as Zepto, Ola Consumer, Physics Wallah, BlueStone, Ather Energy, Smartworks, Ecom Express, among others, eyeing a public listing in 2025.

Inc42 reported on Tuesday that Hyderabad-based electric two-wheeler maker Pure EV has turned into a public company with plans to launch an IPO this year. Fintech giant PhonePe recently announced that it has kicked off preparations for its IPO.