Exclusive: China’s JD.com may lead $25 Mn Series C round in B2B logistics enabler Shadowfax

B2B logistics platform Shadowfax is in talks with Chinese e-commerce major JD.com  for raising Series C round.

“Talks with JD is in a preliminary stage and ongoing for over past five weeks,” says two sources aware of the matter. Besides, the Eight Roads Venture-backed company is also in a parallel conversation with US-based pure-play venture capital (VCs) firms.

The round is likely to be in a range of $18-25 million, emphasise both sources. While Alibaba, Tencent along with several other large and small Chinese Internet groups have acquired strategic stakes in Indian startups, JD hasn’t placed even a single bet in one of the world’s fledgling startup ecosystems.

“JD had acquired Dada Nexus, an Uber like on-demand logistics enabler for o2o (Offline to Online) businesses in 2016. It sees a similar play in India with Shadowfax,” says one of the aforementioned sources. Both sources requested anonymity.

For uninitiated, JD had acquired about half of the crowdsourcing logistics platform - Dada Nexus (now JD Daojia) for $200 million cash.

While talks with JD and couple of other Chinese investors are in early stage, one US-based investor has offered a term sheet to Shadowfax and final negotiations are underway, outline both sources.

Entrackr has failed to ascertain the name of investors who are eying a stake in the company other than JD. We have sent an email to JD.com and Shadowfax for confirmations. We will update the story as responses come in.

Shadowfax claims to be the largest crowdsourced delivery platform with a presence in 75 cities in India. According to our estimate, it delivers about 3 million orders a month. The company offers delivery solutions to regular e-commerce companies including food, medicine, and aggregators in various verticals.

With the acquisition of Sequoia-backed Nuvo Ex last year, Shadowfax has been claiming a leadership position in reverse logistics segment in the country. So far, it had amassed about $18.5 million risk capital.

Meanwhile, Shadowfax revenue had increased by 248 per cent during FY17 as compared to the preceding fiscal. It posted a revenue of Rs 34.07 crore, up from 9.80 crore in during FY16. Its losses stood at 28.51 crore in FY17. It’s yet to file financial statements for the last fiscal.

Of late, JD local rival Alibaba (through Tmall) and Tencent have been investing in relevant interest areas such as food and grocery deliveries, overall e-commerce and payments. Recently, Alibaba invested in Zomato, Bigbasket, TicketNew, and XpressBees while Tencent backed Ola, Swiggy, Practo, BYJU’s and Hike.

On contrary, JD is yet to make a debut in India. Shadowfax could be a maiden investment for the $56 billion valued Chinese dragon (aka conglomerate).