Online grocery and food delivery major Bigbasket has been a major surge in demand amid the coronavirus pandemic and the subsequent lockdown. In the midst of all these, Bigbasket has managed to obtain a bridge funding of $50 million from one of its existing investors, Alibaba, as per an Economic Times report.
It is possible the decision on the investment may have been made before the lockdown. The funding has been done at the last valuation of the company at $1.2 billion. In that round, BigBasket raised $150 million.
A bridge round is usually intermediate funding as the company looks for a larger investment.
Bigbasket says that it is operating at around 50% of its daily capacity. One thing the company is doing to meet demand is to urgently recruit 10,000 additional hands to tide over the shortage of personnel.
With the scale of daily orders going up from around the 150,000 mark, the online grocer will need all the funds to buy and stock more of all essential products sold on its platform. Increase in workforce will also mean more outgo in terms of salaries etc. The company says it is gearing itself by creating the infrastructure to handle 300,000 orders a day.
It may be recalled that in the last round of investment in BigBasket, Mirae Asset-Naver Asia Growth Fund had led the investment along with the CDC Group, apart from existing investors including Alibaba. CDC is backed by the UK government.
The expectation is that even after the lockdown is lifted the demand for online retail will continue. At one level, the experience during the lockdown would have converted many fence-sitters into ordering online and at another there will be a certain amount of fear of moving out for some more time to come.