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World Bank-Backed IFC To Invest $25 Million In Online Grocery Delivery Upstart BigBasket

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International Finance Corporation, the private-sector lending arm of the World Bank, is reportedly going to invest around $25 million in online grocery portal BigBasket in exchange for an undisclosed minority stake in the company. If this happens, it will be IFC’s first investment in Indian startup.

IFC said that it will invest in Bangalore-based SuperMarket Grocery Supplies Pvt Ltd, a wholesale products supplier to BigBasket and the owner of the brand. A separate firm, Innovative Retail Concepts Pvt Ltd, runs the BigBasket property under licence from SuperMarket Grocery.

The investment is a part of an ongoing fundraising exercise of BigBasket. It was reportedly looking forward to raise $150 million in fresh funding in a deal that would value the company at $1 billion.

Recently, BigBasket had raised $50 million in a fresh round of Series C funding from Ascent Capital Group, Bessemer Venture Partners, Zodius Capital and Helion Venture Partners. Till now, the company has raised $85.8 million in three rounds.

BigBasket was founded in 2011 by Hari Menon, V Sudhakar, Vipul Parekh, VS Ramesh and Abhinay Choudhari. It provides its services across nine cities in India, which include Bangalore, Mumbai, Hyderabad, Pune, Chennai, Mysore, Kolkata, Ahmedabad and Delhi-NCR. It has more than 2,900 employees and third-party workers, and three-fourths of them are deployed across the supply chain in distribution centres/warehouses, buying, etc.

The company has also started operations in an unnamed tier-II city in the last two months. It also intends to expand to another 20 tier-II cities over the next two years.

The grocery delivery sector in India is witnessing a lot of investor interest, though thin margins make profits difficult. Startups like Grofers, PepperTap and ZopNow have raised significant amount of funding. PepperTap had recently raised $36 million in funding. Many other major companies like AskeMe.com, Ola and Tata Group has also entered the online grocery delivery space.


 

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