US-based investment fund Maverick Capital Ventures is leading a Rs 100-crore financing round in 1mg, formerly HealthKartPlus, as investors continue to be bullish on the huge potential of online pharmacy startups. The Sequoia Capital-backed 1mg had spun off last year from its parent HealthKart and raised $6 million in capital separately. With the new funds, 1mg plans to expand its marketplace platform to 30 cities from the present 12, and strengthen new lines of businesses.

In the past few months, a spate of e-pharmacy ventures like Netmeds, Phaneesh Murthy-led Zigy and Matrix Partners-backed Myra has scooped up early-stage funding from investors who are tracking the healthcare sector in India.

Prashant Tandon, CEO & co-founder, 1mg, said the company was looking to go beyond delivering medicines and becoming a complete healthcare platform. “Although e-pharmacy is still the big chunk of our revenues, we will be pushing two verticals — e-diagnostic services and ayurvedic medicines,” Tandon said.

For now, the Gurgaon-based 1mg will stick to being a marketplace for pharmacists and not adopt the inventory model. Tandon claimed fulfilment was not an issue and that 90% of its orders were being shipped the same day. “We do three levels of prescription verification and still manage to make deliveries in a day’s time,” he said.

1mg is the second investment by Maverick Capital Ventures, the VC fund affiliate of hedge fund Maverick Capital, in an Indian tech company after backing mobile advertising and commerce player Vserv. Maverick Capital manages $10 billion in assets. 1mg previously raised money from Sequoia India, Omidyar Network, Kae Capital and Intel Capital as part of HealthKart before it spun off in February last year. HealthKart.com now focuses on selling products in the fitness and nutrition space. Mumbai-based investment bank, The Rainmaker Group, was the sole adviser to the deal.

As many as 60 online pharmacy delivery startups have mushroomed over the past two years in India, according to startup data collector Tracxn. Pharmacy retail is estimated to be a $7-billion market dominated by the brick-and-mortar drug retailers. Online deliveries currently account for a meager $10 million in size. But with adoption of e-commerce among Indian consumers and rising spends on healthcare, this category is likely to grow. What may be a challenge for many of these companies is to wade through a highly regulated and licensed pharma industry, which many say is ripe for disruption.

Source: The Times of India