At a time when most Indian startups are struggling to raise a significant amount of funding to further boost their businesses and are fearing valuation downside, Quikr — it seems — is on a different playing field altogether. The classified listing platform has just seen its valuation increase — going completely against those hard tides which others are facing.
As per the annual report published by the company, its valuation has surged about 3.5 times. In the last 12 months, between December 2014 and December 2015, the company’s valuation has surged 3.5 times. Kinnevik holds 19% stake in Quikr and marked the fair of value of its holding in the company at $186 million on 31 December.
This implies that Quikr’s valuation was $979 million. It marks a 257% increase from Kinnevik’s stake value of $52 million as of 31 December 2014.
The company is currently focused on five verticals – automobiles, real estate, jobs, services and customer-to-customer sales. It is also attempting to explore new revenue generation sources.
Quikr recently acquired CommonFloor, an online real estate portal for around $200 million in order to boost its own real estate portal – QuikrHomes.
In its annual report, the company said:
The valuation of Kinnevik’s shares in Quikr was based on the value implied by cash transactions made in secondary Quikr shares with various preferential rights in July 2015 at a valuation of $900 million. The size of the transactions, approximately 6% of the company’s diluted share capital at that point in time, was considered sufficiently large to be applied to Kinnevik’s entire shareholding in Quikr.
As said, most of the companies are struggling to raise further funding. Even Flipkart – India’s one of the leading eCommerce portal is reportedly struggling to raise funding at desired valuation.
Flipkart is basically the poster boy of the Indian eCommerce landscape. Deal has not yet been closed because the investors are willing to invest in the startup at a lesser valuation than that of the last fund raising round in which it was valued at $15 billion.
Recently, Morgan Stanley Institutional Fund Trust marked down its investment in Flipkart by 27%. This decreased the company’s valuation from $15 billion to $11.2 billion.
Earlier this week, RoadRunnr is reportedly shutting down its e-commerce delivery business and instead is focusing on categories that has the potential for higher revenue generation.
Even though Quikr’s valuation is surging, the company is taking every possible steps to lower down its spending. It recently laid-off more than 150 employees after the acquisition of CommonFloor.com.
The honeymoon period for the startups in India seems to be getting over. The companies are facing stiff competition due to overcrowded market and is also getting difficult to raise VC funding after seed funding round.