Indian food delivery giant Swiggy raises $700 million at a $10.7 billion valuation
Swiggy, India’s first food delivery startup, has raised $700 million in a new funding round, just six months after securing $1.25 billion, as it aggressively expands its offerings, including the instant delivery service in the South Asian market.
Invesco led the Series K round of the Bengaluru-based startup, which a source familiar with the matter said values the seven-year-old startup at $10.7 billion. Swiggy was valued at $5.5 billion in July last year.
With a valuation of $10.7 billion, Swiggy has surpassed the valuation of its 13-year-old arch-rival Zomato, which went public last year and whose market capitalization has fallen to less than $10 billion.
New investors Baron Capital Group, Sumeru Venture, IIFL AMC Late Stake Tech Fund, Kotak, Axis Growth, Sixteenth Street Capital, Ghisallo, Smile Group and Segantii Capital as well as existing backers including Prosus Ventures, Alpha Wave Global, Qatar Investment Authority and ARK The Impact has also invested in the new round.
TechCrunch reported in late September that Invesco was in talks to lead a more than $500 million investment in Swiggy.
The new funding follows a strong year of growth for Swiggy in which the startup nearly doubled the gross order value of its food delivery business, he said. Instamart, Swiggy’s instant delivery service, is expected to reach an annual GMV run rate of $1 billion over the next three quarters, the startup said.
Instamart has become one of Swiggy’s main focus areas over the past year and a half.
The startup, which operates in more than 500 Indian cities, said last year it planned to invest $700 million to scale Instamart’s offerings and reach. The fast delivery space, which has made inroads in several markets in recent years, is also becoming competitive in India.
Y Combinator Continuity Fund led the $100 million financing of Mumbai-headquartered Zepto 10-minute delivery service late last year. BlinkIt (formerly known as Grofers), backed by Zomato, which like Swiggy is also backed by SoftBank, pivoted to the instant delivery space last year.
“As long-term investors, the Invesco Developing Markets fund seeks investment opportunities in the best companies in the world, led by world-class management teams, and which have the potential for long-term structural growth” , said Justin Leverenz, Chief Investment Officer. to Invesco Developing Markets Fund, said in a statement. “Our investment in Swiggy represents such an investment.”
Sriharsha Majety, co-founder and chief executive of Swiggy, said Instamart hit GMV in just 17 months, which it took 40 months for the core food delivery business.
“Our goal is to make Swiggy the platform that 100 million consumers can use 15 times a month. We will continue to invest in our people, products and partners to create a positive impact on the ecosystem and accelerate the digital transformation of food and grocery delivery and other on-demand services,” he said. -he adds.
At stake is India’s foodservice market, which is expected to reach $97 billion by March 2026, Bernstein analysts wrote in a report to clients last year.
“The Indian catering market is large and is expected to reach $97 billion by FY25. Organized catering is growing faster and is expected to reach 55% market share by FY25. We forecast online penetration to grow to 20% by FY25 and market size to reach $20 billion, with 46% CAGR growth. A significant part of the growth will be driven by the acquisition of new customers and the penetration of smaller markets. Zomato had 10 million Monthly Transactional Users (MTUs) in FY20, which is expected to grow 5x by FY25 to around 50 million,” they wrote.
Amazon, a third player, has also entered the food delivery space in India in recent years, but, as a Zomato executive mentioned in a public forum last year, the US e-commerce group n has yet to make a breakthrough in this category.