Japanese conglomerate SoftBank is reportedly eyeing an investment of $300 Mn – $500 Mn in foodtech unicorn Swiggy. The company has so far raised $1.5 Bn in funding since its inception in 2014. It counts Naspers, DST Global, Accel, SAIF Partners, Bessemer Venture Partners, Norwest Venture Partners as key investors.
Until the start of this year, the industry pundits were sceptical on who SoftBank would choose between Zomato and Swiggy. However, with reports in January claiming Zomato is courting new investors including Ant Financial to raise a $1 Bn round, the debate seems to have been settled.
Swiggy is currently the fifth highest valued company in the Indian startup ecosystem with a valuation of $3.3 Bn. Zomato, on the other hand, stands at $2.6 Bn. However, this difference is not the reason for Softbank to go ahead with Swiggy as suggested by the people familiar with the development.
Its believed that Nasper’s $1 Bn investment in Swiggy last year had set the stage for the five-year-old startup to get an entry into the SoftBank camp. With UberEATS and Foodpanda sidelined, Swiggy has been able to grab a much larger market share.
The Bengaluru-based foodtech unicorn is currently present in over 175 cities with a fleet of 1.95 lakh active delivery partners from over one lakh restaurant partners.
The company has been looking to diversify its revenue channels by reducing discounts and bringing in more repeat orders as well as entering new verticals. Swiggy Pop, Swiggy Daily, Swiggy Super, Swiggy Stores are some of the initiatives the company has taken in recent times.
Recently, the company invested $4.39 Mn (INR 31.2 Cr) in the Mumbai-headquartered foodtech startup Fingerlix’s Series C round. Speculation is rife that UberEats is in talks with Swiggy to divest its business.
Looking at the earlier bets of SoftBank — OYO, Ola, Grofers, FirstCry, Walmart-backed Flipkart (which it exited), Snapdeal — it is clear that chief Masayoshi Son is gung-ho on grabbing a piece of the finest startups in the Indian consumer internet segment. If the deal goes through, this would be SoftBank’s first direct bet in the Indian foodtech space, which is expected to become a $4 Bn market by 2020.
The development was reported by LiveMint.