ShopClues receives Rs 8 Cr from Clues Network Inc

ShopClues has been struggling to find a firm that can absorb it. Talks with Snapdeal had fallen a long back while consolidation plans with CraftsVilla, Limeroad and others seem to have turned cold. Amidst aggravating perils, the Gurugram-based Unicorn has received Rs 7.86 crore from Clues Network. 

ShopClues has allotted 4,320 equity shares to Clues Network Inc at a price band of Rs 18,200 share each, reveals RoC filings with Ministry of Corporate Affairs (MCA).

According to filings, this would be the first funding for ShopClues this year. Almost a year ago, the company raised Rs110 crore ($16 million) bridge round from a few existing investors.

While the size of the round is small, it will help the company to get rid of liabilities and keep operating until it finds a buyer. According to Entrackr sources, the company likely to get the final bridge round to avoid complete collapse.

Snapdeal had shown interest in acquiring ShopClues. However, it backed out after months of because of liabilities owed by the Tiger Global-backed company to vendors. Entrackr had exclusively reported about ShopClues acquisition talks with Snapdeal and its fall through. 

To control the monthly burn rate, ShopClues also fired about 400 employees this year. It even didn’t pay proper severance to hundreds of employees. The scale of the company also has fallen drastically. Sources emphasise that the volume has fallen below 10,000 orders a day.

Besides grappling with several issues, the company is also under Enforcement Directorate (ED) scanner over Foreign Direct Investment (FDI) it received from its US-based holding entity - Clues Network. Entrackr had exclusively reported about the investigation on ShopClues last month.

Future of ShopClues appears to be in uncharted territory, and it’s trying out hard along with investors to find a buyer. Going forward, it would be interesting to see whether the Unicorn will strike a M&A deal with someone or collapse.