Exclusive: Shop101 raises fresh funds from existing backers

Social commerce firm Shop101 has raised Rs 17.2 crore from existing investors Kalaari Capital, Vy Capital, Unilever, and Stellaris. The fresh infusion is a part of the ongoing Series C round. It had raised Rs 29 crore from these investors in March this year.

The fresh funds will help Shop101 to streamline its operations which have been in soup due to Covid-19 induced nationwide lockdown. Akin to other businesses, industry estimates outline that social commerce was hit hard during the three months long complete lockdown.

Shop101 has allotted 101,266 Series C1 CCPS at an issue price of Rs 1,720 per share to Stellaris, Unilever, Kalaari Capital and VY Capital, as per regulatory filings. While Vy Capital has infused Rs 8.3 crore, Kalaari has infused Rs 2.76 crore in the social commerce company. 

The other investors have invested nominal amounts. Fintrackr estimates that Shop101 has been valued Rs 436 crore (post-money).

Post allotment VY Capital will remain one of the largest shareholders controlling 27.92% stake while Stellaris Venture Partners will hold 16.43%. Unilever Venture Holdings and Kalaari Capital Partners will control 8.69% and 8.41% stake respectively in the social commerce startup. 

To extend its runway and preserve resources, the Bengaluru-based firm had fired close to 40% or 200 of its workforce in May. Shop101 wasn’t the only company in the social commerce space. Other companies, including Meesho have also laid off 200 employees due to Covid-19 pandemic. 

Entrackr had exclusively reported the downsizing by the Facebook-backed firm.

While social commerce was a hot proposition for venture capitals in the 2018-19 period, investors are now concerned due to the slowdown in growth coupled with no signs of an improvement in the unit economics. 

Besides startups who are solely focusing on the sector, large-scaled companies such as Paytm and growth-stage social network platform ShareChat also forayed into social commerce. The SoftBank-backed company launched MyStore to mark its debut in crowded space while ShareChat acquired Elanic.

Entrackr had exclusively reported both developments (here & here).

Last year, close to half a dozen early-stage startups in the social commerce space had raised investments from the likes of Sequoia, SAIF Partners, Accel, Shunwei Capital and Lightspeed. 

The fresh proceeds in Shop101 will be the second investment in the social commerce space post-Covid-19 pandemic. CityMall had raised $3 million from SAIF Partners recently.