Online grocery major Grofers has successfully raised $200 Mn in series F funding round from SoftBank Vision fund. Existing investors Tiger Global and Sequoia Capital as well as new investor KTB also took part in the funding round. The round has catapulted Gurugram based company to the coveted unicorn club and has now become part of the long list of Indian startups with billion dollar valuation.
Grofers had raised $62 million from SoftBank barely two months back. Tiger Global and Sequoia Capital had also participated in this round.
Speaking to TechCrunch, Grofers’ co-founder and CEO Albinder Dhindsa said that the company will use the latest capital infusion to expand to newer markets but refused to comment any further on the issue.
It has been quite a remarkable comeback for the company that until last year was struggling to catch up with its big rival BigBasket. The situation was so precarious that company even agreed to take substantial markdown in its valuation for securing $62 million from SoftBank and other investors last year. However, this round helped to bring the six-year old company not only from the brink but also paved way for an unexpected resurgence.
How Grofers Managed to make a Comeback
Grofers tried to address its woes by focusing on private labels and propelling growth in the existing markets. This strategy has most certainly paid off as the company claims to have achieved top line of $400 Mn and growing at 8X in last two years. The company ended the financial year 2018 with total sales of $129.49 Mn (INR 950 Cr). Earlier this year, it claimed to have clocked revenue of INR 310 Cr and crossed INR 300 Cr in monthly sales.
However, Grofers’ balance sheet appears to be tad weak when compared with its big rival BigBasket. In January the Bengaluru headquartered company reported a 34% hike in its revenues to clock total revenue of INR 1,606 Cr ($ 230.95 Mn) for FY18.
BigBasket has also been aggressively pursuing the acquisition strategy while Grofers has been pretty much lackluster on this front. The company acquired three companies in a trot in October last year. These companies were RainCan and Morning Cart and Kwik24.
BigBasket and Grofers are not the only ones chasing India’s lucrative yet challenging online grocery market. Big e-commerce players like Flipkart and Amazon over the last one year have been trying very hard to make a dent into the online grocery market.