It’s the best time to be in the food order-taking and delivery business in India right now. The VCs are simply circling above with loads of cash looking for the right startup to invest in. It’s the turn of Swiggy to gain from these encouraging signs with an expectation of $50 million-$100 million from Coatue Management, a renowned hedge fund with global footprints. There may be a few other investors also joining in this round of funding.
And this information comes just a couple of months after Swiggy bagged an investment of $100 million from 2 other big names; China’s ecommerce major Meituan-Dianping and the South African company Naspers. Meituan-Dianping, which had put in $40 million out of that amount, is said to be in talks again this time too. The last evaluation of the startup placed the value of Swiggy at $700 million.
It has also been learnt that for Coatue Management, this is not the first attempt at wanting to invest in Swiggy and even in the last $100 million funding round. This has raised doubts in the minds of the observers if this investment is part of the last round or a fresh initiative by Swiggy to strengthens its finances.
If the $100 million funding does come through, it will help Swiggy strengthen its ammunition as it readies itself to take on the competition led by Zomato.
The food delivery space is developing into a 5 horses race, with Uber Eats and Ola (Foodpanda) and Google Areo joining the battle between Swiggy and Zomaro.
On the business front, Swiggy is booking 4.5 million orders a month and is considered the leader in this segment, though Zomato is also recording phenomenal increases in sales over the past 2 years. The industry itself is showing a significant jump in orders, from around 2 lakh orders a day to a whopping 4.6 lakh orders a month.
Swiggy has raised an overall $255.5 million so far just around half of what its rival Zomato has been able to raise. While Swiggy has been able to improve its topline multiple times, its losses are also mounting. The company claims it has been able to bring down the costs it incurs on deliveries.
Coming the Coatue Management, the investor has funds worth $15 billion under its management and incidentally it is an investor in the Chinese company Meituan-Dianping as well.
In India, it has made a small investment in Quikr. Though a technology-focused fund, Coatue has picked up stakes in a few cab-hailing firms internationally, like Grab (SE Asia), Didi Chuxing (China) and Lyft (US).