India’s leading online food delivery startup Swiggy has initiated talks with existing and new investors to raise funds amounting to anywhere between ₹1,719 crores ($250 million) to ₹3,438 crores ($500 million) with an estimated valuation of ₹17,194 crores ($2.5 billion), according to people familiar with the development.
If the new funding comes through, this will be Swiggy’s third round of funding this year. In February this year, the startup had raised around ₹688 crores ($100 million) in a series F funding led by South African internet company Naspers and Chinese e-commerce Meituan Dianping. Later in June, it had secured nearly ₹1,444 crores ($210 million) in a series G funding led by Naspers and DST Global.
As Swiggy engages in a fierce rivalry with its Gurugram-based competitor Zomato and burns cash at a rapid pace in a bid to capture the market. New funds will come in handy to support its ambitious goals.
Swiggy held talks with a clutch of new investors including SoftBank, growth equity firm General Atlantic and a couple of Chinese hedge funds for the new round. The Chinese investors are speculated to be Tybourne Capital and Hillhouse Capital, but the names could not be confirmed, as told by the sources.
Swiggy’s largest stakeholders including US-based hedge fund Coatue Management, along with Chinese e-commerce giant Meituan Dianping and Naspers are expected to participate in the new round.
While Swiggy is trying to get new funds, its rival Zomato is also in advanced negotiations with existing investor Ant Financials, the investment arm of Alibaba and Singapore-based Temasek to raise ₹2,064 crores ($300 million).
Swiggy is looking to expand into new cities as it continues to expand its business verticals. In order to further its goals, recently, Swiggy had acquired an on-demand delivery startup Scootsy, as it plans to venture into hyperlocal delivery.
Its rival Zomato is also looking to venture into new cities to expand its business to compete with Swiggy. The growing rivalry in the online food delivery space also includes UberEATS, along with Ola‘s Foodpanda.