After acquiring its competitor Myntra in May, Flipkart has now raised USD 1 billion in a fresh round at a valuation of over USD 5 billion, to scale up its operations as it competes with Amazon.in and homegrown competitor Snapdeal. Half of the amount will be invested by the existing investors Tiger Global, DST and Accel Partners while the rest amount will come from several new investors.
“The deal is done,” one person with the knowledge of the deal said. “An announcement could be made in a week or two.”
“This is the war chest to consolidate Flipkart’s position in the country — the sector needs long-term, patient investors who can back with big money,” told another person to Economic Times
Flipkart has also launched customer service initiatives like same-day delivery in multiple cities along with at-home trials for certain fashion categories. It had crossed USD 1 billion in sales in March and also continues to discount heavily along with other players like Amazon and Snapdeal.
Including this round, the company has secured a total funding of USD 1.7 billion in seven round of investments. It is backed by nine investors and had acquired three companies till date such as Myntra, LetsBuy.com and WeRead. The company also having 8 competitors like Billdesk, Shopclues.com, Jabong.com, Snapdeal, Indiaplaza and others.
Economic Times says: India’s e-commerce sector is on fire, especially after Amazon entered the country last June. With some of the biggest retailers in the world jostling to get a piece of action in India, e-commerce companies in the country are riding a wave. For instance, while e-Bay is banking on Snapdeal, both Amazon and Walmart are pushing aggressively to conquer what is fast becoming the last frontier for them.
“It’s crazy — but justifiable considering e-commerce in India has just hit the tipping point and companies with most market share will reap the biggest returns,” said a top executive at one of the e-commerce companies.
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