Udaan, a B2B ecommerce unicorn, reported a significant reduction in its valuation, plummeting to around $1.8 billion in a down round, according to a report from ET.
The Bengaluru-based startup achieved a valuation of $3.2 billion in its latest funding round, which took place in January 2021.
A down round refers to a funding round where a company secures capital at a valuation lower than that of a prior round.
In December last year, Udaan secured $340 million in its Series E funding round, led by UK-based savings and investment firm M&G Prudential, with participation from existing investors Lightspeed Venture Partners and DST Global.
Continue Exploring: Udaan secures $340 Million in Series E funding, eyes public market in 12-18 months
The funding round comprised a combination of new equity investments and the conversion of current debt (convertible notes) into equity.
B2B Facilitation: Udaan’s Business Model and Operations
Established by Vaibhav Gupta, Sujeet Kumar, and Amod Malviya, Udaan facilitates B2B trade with a focus on supply chain and logistics operations. Udaan asserts its ability to support daily deliveries spanning over 1,000 cities and 12,500 pin codes through udaanExpress. Noteworthy backers include Lightspeed, Microsoft, and Tencent.
Shortly after securing $340 million in its Series E funding round, Udaan terminated nearly 120 employees within a week.
“We have already made significant progress in our journey towards building a profitable business and continue to make relevant interventions to our already proven business model, while remaining customer-centric and agile. However, these interventions have also resulted in some redundancies in the system,” the spokesperson said.
According to the report from ET, Udaan’s CEO, Vaibhav Gupta, has reportedly underscored the company’s commitment to quarterly cost reduction. The team is said to be actively working on a quarterly basis to align with this strategic focus. Udaan has purportedly set explicit operational targets and conveyed to investors its goal of attaining operational profitability within the next two quarters.
Nonetheless, Udaan is not the sole unicorn experiencing devaluation recently. The US-based asset manager BlackRock has once again significantly reduced the valuation of edtech major BYJU’S, this time by approximately 95%, plummeting from $22 billion to $1 billion.