Food delivery major Swiggy may get an infusion of $200 million from South African Internet group Naspers, one of the world’s largest tech-focused investors. Naspers could also partner Chinese Internet giant Tencent to participate in the round, which in the run to invest in the Bengaluru-based foodtech startup.
Earlier, Indian e-commerce behemoth Flipkart and Japan’s tech titan Softbank were also in the race to invest in Swiggy independently but the discussion ended in a matter of two months.
Meanwhile, SoftBank invested in global cab hailing company Uber for a significant stake. The deal also sees a potential in Uber’s food delivery arm UberEats, which is a growing competitor to Swiggy and other players like Zomato and Ola-acquired Foodpanda in India.
After acquiring Runnr last year, Zomato and Swiggy also held talks for a prospective merger. However, the proposed deal could not bear any fruit and ultimately failed due to the disagreement regarding valuation and the terms of the deal between the two rivals.
Swiggy growth graph and competitors
The food-tech space in India is currently on a rise and there is enough potential to grow in this segment. Food delivery major Swiggy crossed 5 million order mark last month. This is a significant upside for the food delivery company that was delivering 3.5 to 4 million orders a month during August to October period this year.
Till date, Swiggy has raised $156 million. In May this year, Swiggy raised $80 million in Series E funding led by Naspers. The startup raised the funds at a valuation of $400 million. The proposed deal could raise the valuation of the food delivery company to $600-650 million.
On the other hand, Gurugram-based Zomato has raised about $223 million till date and last raised funding in 2015 at a valuation of about $960 million. It is also reportedly in talks with Chinese investor Ant Financial for a $200 million funding round.
Ride-hailing company Uber also launched UberEats last year in India. It is currently available in six Indian cities. Uber is eyeing a $15-20 billion market in the food delivery market and the firm has also hired former Oyo Rooms executive Vartika Bansal to help expand the food delivery business.
Recently, Ola has re-entered food delivery space with the acquisition of Foodpanda India from the parent firm Berlin-based food delivery marketplace Delivery Hero Group. Post acquisition, Ola is also investing $200 million in Foodpanda.
The development was first reported by ET.