Laying rumours to rest, Snapdeal, India’s second largest e-commerce company in terms of sales and GMV, has today confirmed its speculated $500 Million fund-raising round led by Foxconn and Alibaba. Post Softbank’s $627 Million nine months ago, this will be Snapdeal second big fund-raise among many other smaller rounds in between.
The announcement for Snapdeal’s current round was also confirmed via a tweet posted by Kunal Bahl few hours ago. Here’s his tweet :
Welcoming Alibaba and Foxconn to the @Snapdeal family. We never thought we'd come this far. Team super energised to create impact for India.
— Kunal Bahl (@1kunalbahl) August 18, 2015
Really big day for the entire team @snapdeal. Now I know how Pepper the Robot felt :-) #feelingawesome pic.twitter.com/0X09rX6EuR
— Kunal Bahl (@1kunalbahl) August 18, 2015
While Snapdeal hasn’t really made clear as to how it plans to use its second biggest fund-raise till date, most of it though, will go along fighting Flipkart for a larger market share. However, with the recent $100 Million research investment announcement, we could see Snapdeal investing more in acquisitions and new product developments, rather than just running after giving you deep-discounts on the upcoming festive season.
Other specifics regarding the deal are too under wraps, though a report earlier today, cited sources within the company, saying the eBay, one of Snapdeal’s largest and most influential investors may have diluted its stake in the current round, divided among Foxconn and Alibaba.
While this will be Foxconn’s first major investment into an Indian company, for Alibaba, this will be the second big investment in a single domain. Earlier, Alibaba-backed Ant Financials had pumped in a massive $575 Million into PayTM (with rumours of even more cash coming in later), to help expand it into a full-fledged e-commerce marketplace.
Snapdeal’s this round is pretty important for the company. Flipkart recently raised a speculated $700 Million, valuing India’s biggest e-commerce brand at over $15 Billion. Amazon too has announced pumping of as much as $5 Billion into its Indian arm over the course of next few years.
