The mostly unregulated sector of mom and pop shops in India, or as they are dearly called in the native language-Kiryana Stores, boasts huge potential, and has invited a lot of attention from large players in recent years. Udaan, a B2B platform that aims to regulate this market and revolutionize the way Indian Kiryana stores operate, has raised $280 million.
Happy to announce that we’ve raised $280 Million in additional financing, further reinforcing the huge potential of b2b eCommerce in India.
We’ll deploy the funds towards further market creation & bring the benefits of b2b eCommerce to small businesses.https://t.co/4ZxPfOdxX6
— udaan (@udaandotcom) January 6, 2021
The funds were raised as the startup continues to grow at an exponential rate, fueled further by the COVID 19 pandemic. The capital raise was part of an extended Series D funding round, which saw participation from Octahedron Capital and Moonstone Capital, along with existing investors Lightspeed Venture Partners, DST Global, GGV Capital, Altimeter Capital, and Tencent.
Udaan describes itself as Business-to-Business (B2B) ecommerce platform, designed to solve core trade problems for small, medium and large businesses across India. The startup offers products from a wide range of categories, including lifestyle, electronics, home & kitchen, staples, fruits and vegetables, FMCG, pharma, toys and general merchandise.
It aims to help solve the distribution problems of the Indian retail market, by connection businesses with manufacturers, brands, white labels, importers etc. on a single platform. The platform also allows retailers to have one on one discussions with the selling party to negotiate terms of trade, thus empowering businesses.
Another problem that Udaan solves is the issue of working capital. Indian businesses usually rely on being able to sell their inventory before getting payments, which means that if a retailer cannot buy more inventory before selling the old stock. However, since Udaan is able to calculate the engagement of a business, it is able to provide working capital ahead of time, thus facilitating commerce between companies.
All of these facilities have allowed Udaan to onboard thousands of companies throughout the world, including Coca Cola, PepsiCo, Boat Lifestyle, Micromax, HP, LG, ITC, HUL, and P&G. It had managed to raise $585 million in its Series D funding round, and the new capital brings the total to $865 million.
The company plans to use this capital to fuel growth, as well as introducing more categories and products on its platform.
Commenting on the development, Amod Malviya, Co-founder, udaan said “Covid-19 has accelerated the already fast digital-led evolution of highly fragmented and unorganized Indian trade/ retail industry. While at the same time, the pandemic also highlighted unique structure of Indian economy, with millions of kiranas and neighbourhood stores becoming the lifeline of our country at the time of crisis. udaan is at the forefront of this uniquely Indian eCommerce opportunity, emerging in the last 4 years as one of the largest eCommerce platforms in India, while taking an India-first mobile-first approach to eCommerce. This financing enables us to further our journey of taking eCommerce to the depth and breadth of the country, with udaan’s unique low-cost model for core middle India.”