After reports of Grofers raising $150 million, there are now reports that rival BigBasket is close to finalizing its own funding exercise to raise around $300-$400 million. And BigBasket could end up being valued at around $1.5 to $2 billion making it a Unicorn, the 8th such startup from the country.
The interesting part is there were moves at bringing about a merger of these two startups but apparently that has now been stalled and that is one of the reasons the funding process has gained momentum.
The major investor in BigBasket is Chinese conglomerate Alibaba and it is possible there may be new investors taking position in the startup besides the existing investor.
The founder of BigBasket had claimed that they are really not scouting for funds since they are sufficiently funded. On the other hand, the company has to prepare itself in the marketplace to meet the challenges thrown by giants with deep pockets, Amazon and Flipkart (now owned by Walmart). Both these leading ecommerce companies have made public their intentions to press ahead with their foray into the grocery and fresh produce segments that run directly against the categories BigBasket deals in.
AS per the Mint report, BigBasket will use the funds to be raised in this round to make some strategic acquisitions that will rapidly scale up its operations, apart from adding meat and beauty products to its offerings. It recently announced foray into subscription model with milk delivery that will be used as piggyback to lure the customers to place orders for other essentials like eggs, bread and so on. There is the offline kiosk model that is now being run on a pilot scale in Bangalore and will be taken to other metros.
Just earlier this year BigBasket had raised its last funding of $300 million from Alibaba and its valuation that time was $800 million.