Ecommerce unicorn Meesho is reportedly preparing to secure $300 million (around INR 2,499 crore) in a fresh funding round, with investors including Tiger Global and SoftBank.
The fundraising will also involve contributions from current and other investors, including Peak XV Partners and Mars Growth Capital, as reported by Moneycontrol.
According to the report, the $300 million funding round, a rarity in the current funding landscape, not only indicates Tiger Global’s re-entry into investing in India but also represents the investor’s inaugural significant round since the departure of Scott Shleifer, head of private equity, in November last year.
Once finalized, Meesho’s funding round will be among the rare large-scale investment rounds to have taken place in the past year.
Tiger Global and Peak XV Partners are set to spearhead Meesho’s latest funding round, jointly injecting $150 million into the venture. Additionally, Peak XV, along with select limited partners (LPs), intends to contribute approximately $70 million, as outlined in the report.
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While Tiger Global will be a new addition to Meesho’s list of investors, Peak XV previously invested in the e-commerce company back in 2018.
The current funding round values Meesho at $3.9 billion, a 20% reduction from its previous valuation of $4.9 billion in 2021. This decrease comes after Fidelity adjusted its valuation to $3 billion, as reported by Moneycontrol in January.
SoftBank will contribute $30 million of the remaining $150 million, with the rest coming from Singapore’s Mars Growth Capital, UK’s Think Ventures, and other investors. SoftBank, an existing investor, will augment its investment to uphold its stake in the company, whereas Mars and Think will be newcomers as funders for Meesho.
According to the report, Meesho is currently transitioning its headquarters from Delaware back to India, with a significant portion of the new capital earmarked for settling associated taxes in preparation for its anticipated IPO.
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The report also mentioned that Meesho’s $300 million round will primarily comprise primary capital, with a small portion allocated for secondaries to buy out early investors. According to Tracxn, a private markets data provider, some of Meesho’s early supporters include Venture Highway, Meta (formerly Facebook), and Y Combinator.
Established in 2015 by Vidit Aatrey and Sanjeev Barnwal, Meesho asserts that it hosts over 1.5 million sellers on its e-commerce platform spanning across India. Additionally, the startup boasts of having over 140 million annual transacting users.
Earlier this month, the e-commerce startup introduced a INR 200 crore (approximately $25 million) employee stock ownership plan (ESOP) buyback program. The startup stated that this is the largest ESOP buyback program it has initiated and will benefit approximately 1,700 past and present employees.
Prosus, Elevation Capital, DST Partners, and Facebook are among Meesho’s investors. Its parent company, Fashnear Technologies, recorded a 48% decrease in net loss, dropping from INR 3,248 crore in the previous fiscal year to INR 1,675 crore in FY23.
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