It is the only e-commerce company in the top ten with $7 billion in funds.
After its latest fund-raise from SoftBank, Flipkart is the world’s third-most funded private company, and the most funded e-commerce startup. It trails China’s Didi Chuxing and America’s Uber – both ride-hailing companies – in capital raised. Till date, Flipkart has raised $7 billion, while Didi and Uber have been infused with $15 billion and $12.9 billion respectively. Interestingly, Flipkart is the only e-commerce company in the top 10, according to reports.
Flipkart’s investors include Tiger Global (which until now was the majority stakeholder), SoftBank (which has invested a massive $2.5 billion in the country’s biggest tech funding round), eBay (that has paid $500 million in cash and has also sold its India biz), Microsoft and Tencent (which have led the $1.4 billion funding round in April). After a period of lull, eroding valuation, and rising competition from Amazon, Flipkart is back on track. It continues to be India’s most valuable startup at $11.5 billion.
While funding may not necessarily mean that a company is in great financial shape, it does indicate the investors’ faith in Flipkart. Despite the fact that it has failed to turn a profit in over 10 years – something that the startup world is obsessed with – SoftBank believes that Flipkart is the “pioneer”. “We want to support innovative companies that are clear winners because they are best positioned to leverage technology and help people lead better lives. As pioneers in Indian e-commerce, Flipkart is doing that every day,” Mayasoshi Son, SoftBank Founder and CEO, said in a statement. ALSO READ: Flipkart completes eBay India acquisition; will run it as an independent company
SoftBank is acutely aware of Amazon’s growing muscle in India. It wants to ensure that Flipkart widens its lead. Amazon has invested close to $5 billion in its India business since 2013. India is its fastest-growing market globally and given the huge opportunity in the domestic e-commerce sector, Amazon’s investments are likely to grow. For Flipkart, the SoftBank investment comes at a time when its potential buyout of Snapdeal has come to nought. That would’ve given it a ready edge over Amazon in terms of market share. However, when that is not to be, Japanese capital is a fresh lease of life. We’ll have to see what it makes of that money.