Both Zomato and Grofers have ridden through the tough times of 2020, and have come out the stronger. While Grofers continues to persevere, food delivery giant Zomato is aiming for an ambitious IPO. At a time when the pandemic has forced people to stay at home and go online even for basic services like buying groceries, Grofers has reportedly entered the coveted unicorn family after Zomato invested $120 million in the Gurugram-based grocery delivery start-up.
According to a report by MoneyControl, both companies signed the deal on Tuesday, leaving Grofers with a valuation of just over a billion.
According to Grofers, the company’s current focus remains to best serve consumers while continuing to develop technology that empowered the grocery ecosystem to make products more affordable and accessible for millions of Indian households. As for Zomato, the giant did not comment on the matter.
You might remember that this is not the first time Zomato and Grofers have tried to forge a deal. Both companies had explored a potential merger last year as Zomato wanted to utilize Grofers’ platform to expand its presence in the groceries delivery market. However, talks for the all-stock merger fell through.
This comes soon after Grofers co-founder Saurabh Kumar announced that he would be leaving the eight-year-old start-up (Kumar will continue to be a board member and shareholder of the company). The start-up has raised nearly $662 million across equity and debt rounds and includes among its investors prominent names such as Sequoia Capital India, Trifecta Capital Advisors, SoftBank Vision Fund, Abu Dhabi Capital Group as well as Bennett Coleman and Co Ltd.
Zomato and Grofers are well-established names in Indian households today. With the online grocery segment growing by about 30 times over the past years to come at $3 billion, their businesses are likely to remain on the upward curve.
Moreover, Zomato is looking to go public very soon, and with Grofers under its belt, the company may have a better opening than expected earlier.