Snapdeal parent Jasper Infotech reported on Sunday, announced closure of $200 million fresh funding round led by one of the world’s largest pension funds Ontario Teachers’ Pension Plan and Singapore-based investment entity Brother Fortune Apparel, among others.
For a while now, Snapdeal has been at war with other e-commerce platforms operating in India. Its biggest competitions, by far, are Flipkart and Amazon. The latest funding round brings Snapdeal to the position of the second largest valued startup in the country, following Flipkart.
The round brings up the platform’s value close to $6.5-$7 billion which is a great improvement following its previous valuation at $4.8 billion after a $500 million round led by Foxconn and Alibaba almost a half year ago. But again, considering how bigger investors are getting increasingly varied of Indian e-commerce companies’ valuations, an increased valuation for a significantly lower round might bring in more troubles than better brand positioning.
Just under a month ago, Jasper Infotech reported a loss of Rs. 1328 crore for the previous financial year. This pointed towards the fact that the company’s losses had increased five-fold in just 12 months. This was primarily because it spent heavily to maintain its market share amidst growing competition from Amazon and Flipkart.
This funding round comes just in time, giving the company some breathing space before it prepares for a much bigger (reportedly $1.4Bn funding round later). Iron Pillar and a few other investors also participated in this round, according to Venture capital.
The company says that the capital raised during this round, and a few previous ones, will be utilized to further build its technology platform, logistics, payments and back-end infrastructure.
We see these investments as a continuing endorsement of Snapdeal’s strategy to build India’s most reliable and frictionless commerce ecosystem,
said Anup Vikal, chief financial officer at Jasper Infotech, in a statement.
We continue to make targeted investments in building internal and external capabilities that will enable us to consistently deliver optimal experience for the millions of buyers and sellers who transact daily on Snapdeal.
Snapdeal’s owner Jasper Infotech has raised to the north of $2 billion in funding from multiple investors. These include Premji Invest, Intel Capital, Bessemer Venture Partners, Ratan Tata, Japan’s SoftBank, China’s Alibaba Group and Taiwan’s Foxconn.