Foodtech major Swiggy has closed a $1.25 billion round led by SoftBank Vision Fund 2 and its existing backer Prosus. Accel Partners, Wellington Management, Qatar Investment Authority, Falcon Edge Capital, Amansa Capital, Goldman Sachs, Think Investments and Carmignac also participated in the round.
While the company had raised $800 million in April, it has topped the round with another $450 million. This marks SoftBank’s first investment in the Indian foodtech sector. Last week, the Japan-based investor had received approval from the Competition Commission of India to invest in foodtech platform.
“Our biggest investments will be in our non-food businesses that have witnessed tremendous consumer love and growth in a short span, especially in the past 15 months of the pandemic,” said Sriharsha Majety, CEO, Swiggy.
Avendus Capital was the financial advisor to Swiggy on the transaction.
The announcement has come on the heels of the reshuffle at Swiggy’s top management. Last month, Vivek Sunder, chief operating officer or the COO had put in his papers. Soon after his resignation, Swiggy also elevated Phani Kishan to a co-founder role.
Besides the core business, Swiggy has also launched several services such as instant grocery delivery service, Instamart, pick-up and drop service, Swiggy Genie and daily grocery delivery service, Supr Daily. While Supr Daily is present across major cities, Swiggy Genies was recently expanded to 65 cities in the country.
Like many businesses, food delivery companies were severely impacted during the coronavirus lockdown in various parts of the country. However, the segment saw a revival after some relaxations by the government. According to Swiggy, it connects consumers to over 1,50,000 restaurant partners and stores in over 500 cities.
Importantly, SoftBank also held talks with Zomato for investment but the talks fizzled out for some unknown reasons. Getting SoftBank on its side is a validation of its leadership in the segment. The company competes with Zomato which recently made its debut in the public market.
SoftBank, which announced that the total investment through Vision Fund 2 in India could go up to $4 billion by the end of this year, had recently invested in Flipkart. Since the beginning of this year, it has backed Meesho, Zeta and Whatfix and is reportedly in talks to back B2B e-commerce platform OfBusiness, and edtech unicorn Unacademy in their upcoming funding round.
