Indian food delivery start-up Swiggy is in talks to raise more than $ 500 million in a new round of funding that could value it at more than $ 10 billion, two sources familiar with the matter told TechCrunch.
Atlanta-based Invesco is in talks to lead – or co-lead – the new round of funding for the Bangalore-based startup, which counts SoftBank Vision Fund 2, Falcon Edge Capital and Prosus Ventures among its existing investors, sources added.
A deal has yet to be finalized, so terms may change, one said. Swiggy made no comment on Monday. Indian media outlet CapTable first reported on the fundraising talks.
The new fundraising talks come less than three months after Swiggy finalized a $ 1.25 billion funding round at a post-money valuation of $ 5.5 billion. The startup’s main rival in India, Zomato, made a remarkable debut on Indian stock exchanges this year, which paved the way for Indian mainstream tech startups to explore public markets. Zomato’s market capitalization jumped to $ 14.5 billion on the stock market, from a valuation of $ 5.4 billion in private markets earlier this year.
Swiggy, like his big rival Zomato, has been hit hard by the pandemic. But it has recovered sharply in recent quarters, the startup said in July. The value of orders she was processing that month was 30% higher than before COVID, he said.
Amazon also entered the food delivery space in India last year, but, as a Zomato executive mentioned in a public forum this year, the company has yet to make a breakthrough in this category. Amazon’s food delivery service is currently only available in Bangalore.
At stake is the Indian food service market, which is expected to reach $ 97 billion by March 2026, analysts at Bernstein wrote in a report to clients this month.
Image credits: Bernstein
âThe Indian food service market is large and is expected to reach $ 97 billion by FY25. Organized food services are growing faster and are expected to reach 55% market share by FY25 We expect online penetration to grow to 20% by FY25 and market size to reach $ 20. billion dollars with 46% CAGR growth. A significant part of the growth will be driven by the acquisition of new customers and the penetration of smaller markets. Zomato had 10 million Monthly Transaction Users (MTUs) in FY20, which is expected to increase fivefold by FY25 to around 50 million. ” they wrote.
Swiggy’s recent gamble – the expansion of fast grocery delivery – has also gained traction at a time when rivals in space (Grofers and BigBasket) haven’t seen such traction or haven’t. still aggressively explored the space. Zomato, which invested around $ 100 million in Grofers earlier this year, this month closed a pilot program where it was testing grocery deliveries.