Swiggy, the online food delivery startup, is currently in talks with potential investors to raise at least USD 50 million in fresh funding.
Among the potential investors include South African media company Naspers and Chinese conglomerate Fosun International, two people familiar with the developments were quoted as saying. They added that existing investors are also likely to participate.
“The existing investors are likely to pool in at least $20 million,” said the source.
Raising funds would give Swiggy a shot in the arm in the race with rival Zomato.
Thus far, Swiggy has raised at least USD 75 million in equity from investors including SAIF partners and Apoletto, which is owned by Russian billionaire Yuri Milner. The company has also raised about USD 8 million in venture debt from InnoVen Capital.
Zomato leads the funding race among homegrown food technology startups with USD 224 million in its kitty.
Swiggy currently operates in eight cities—Bengaluru, Delhi, Mumbai, Chennai, Pune, Gurgaon, Hyderabad and Kolkata.
In the last financial year, Swiggy recorded a 65-fold increase in losses. To shore up its profits, it started charging a fee of Rs 30 on orders below Rs 250 and also experimented with surge pricing.
Food tech startups in India are struggling to find a way to profitability even as millions of dollars have been guzzled for customer acquisition.
Over 78 food delivery and ordering startups have raised USD 391 million in multiple rounds since 2014 in India, according to data by Tracxn.
Since then, a good odd 999 companies have been created in this space, with 110 already shutting shop. This also includes cab aggregator Ola’s food delivery platform Ola Cafe that had to be shut within a year of launch.
Source: Money Control
