Udaan Secures $340 Million in Series E Funding, Experiences 59.3% Valuation Dip
Three points you will get to know in this article:
- Udaan raised $340 million in Series E funding, achieving a post-allocation valuation of $1.3 billion.
- A supplementary $33 million in a technically overlapping Series F round increased the valuation to $1.7 billion.
- Despite a 43.1% GMV decline, Udaan demonstrated adaptability with a significant 33.7% reduction in losses.
Udaan, the B2B e-commerce platform, recently revealed a substantial boost in funding with a noteworthy $340 million injection during its Series E round. The financing was jointly led by M&G Plc and Lightspeed Partners Venture, alongside ongoing support from existing investors like DST Global and Tencent, among others. It’s worth noting that specific details were not disclosed by the Singapore-based company in their official announcement last December.
In our quest for a deeper understanding, Fintrackr diligently combed through Udaan’s regulatory filings. Our mission was to unravel the intricacies of the funding round, explore the cap table, and uncover the most intriguing aspect—the company’s newfound valuation.
Special Resolution and Funding
According to the regulatory filings sourced from ACRA Singapore, Udaan’s board made a significant move by passing a special resolution. This resolution paved the way for the issuance of 10,15,753 Series E CCPS at an issue price of $338.6 per share. This strategic move aimed to raise an impressive $340 million in funds. Our findings shed light on the financial maneuvers that have propelled Udaan to new heights, providing a more transparent perspective on their recent financial developments.
Lightspeed led the charge in the funding round, injecting an impressive $160 million, while M&G pitched in a substantial $157 million. Notably, DST Global, Tencent Cloud, Altimeter Partners, and Apoletto Limited also played their part by contributing $10.46 million, $11.83 million, $3.63 million, and $1 million, respectively, during the Series E round.
Funding Allocation and Valuation Insights
As per insights from the data intelligence platform, TheKredible, the company experienced a significant 59.3% dip in its valuation, settling at $1.3 billion post the Series E round allocation. It’s worth noting that the Bengaluru-based unicorn had reached its pinnacle with a valuation of $3.2 billion in January 2021.
Fast forward to August of last year, and Udaan was on the lookout for fresh equity capital, eyeing a valuation range between $1 billion and $1.5 billion, adding another intriguing chapter to its financial journey.
In addition to the Series E funding round, Udaan successfully secured an additional $33 million during the Series F round, garnering support from notable entities such as Microsoft Corporation, Tencent Cloud, and its co-founder Sujeet Kumar. Their respective contributions stood at $27.55 million, $2.82 million, and $2.7 million, according to official filings.
Valuation Increase and Share Series Differentiation
However, clarifications from the company’s spokesperson revealed that this particular funding injection, although labeled as Series F, was technically part of the same Series E round. The use of different commercial structures resulted in the distinct categorization of share series. Notably, the shares issued in this extension (designated as Series F) were priced higher than those in the original Series E, leading to a valuation increase to $1.7 billion.
Overall, Udaan witnessed a significant 48% decline in its valuation from its peak. According to insider information, this calculation includes accrued interest conversion, though Udaan refrained from providing any official comments on the revised valuation.
Following this influx of funds, Lightspeed emerged as the largest external shareholder with a 35.7% stake, while DST Global and M&G Plc collectively hold a 19.59% interest. The co-founders, namely Sujeet Kumar, Amod Malviya, and Gupta Vaibhav, maintain a combined ownership of 16.45% in the eight-year-old company.
Company Overview and Presence
Established in 2016, this company operates a diverse marketplace that spans various categories, catering to lifestyle, electronics, home & kitchen, staples, fruits and vegetables, FMCG, pharma, toys, and general merchandise. With a proud network comprising over 3 million retailers in 900 cities, their presence is truly widespread.
In the fiscal year concluding in March 2023, Udaan experienced a 43.1% year-on-year decline in Gross Merchandise Value (GMV), amounting to Rs 5,629 crore, in comparison to the Rs 9,900 crore recorded in FY22. However, amidst this, there was a notable 33.7% reduction in losses, which came down to Rs 2,076 crore in FY23. Despite the challenges, the company continues to evolve and adapt to the dynamic market landscape.
Udaan, the B2B e-commerce platform, secured a substantial $340 million in its Series E funding round, led by M&G Plc and Lightspeed Partners Venture. The regulatory filings revealed a significant 59.3% dip in valuation, settling at $1.3 billion post the Series E round allocation. Additionally, the company secured an extra $33 million in the Series F round, resulting in a valuation increase to $1.7 billion. Despite a 43.1% decline in Gross Merchandise Value (GMV), Udaan experienced a notable 33.7% reduction in losses, navigating evolving market challenges while continuing to adapt and evolve.
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