Also in this letter:
■ GreyOrange, BluSmart raise funds
■ Plum’s FY23 financials
■ GenAI smartphones
Walmart to pump $600 million in Flipkart
Kalyan Krishnamurthy, CEO, Flipkart Group
US retail major Walmart has committed to infusing $600 million in Flipkart, as part of the ecommerce firm’s $1-billion fundraise, people aware of the matter told us.
Valuation math: The Indian ecommerce company’s latest financing is likely to value it at a 5-10% premium to its latest readjusted valuation of $33 billion.
This will be Flipkart’s first funding since 2021, when it closed a $3.6 billion round at a valuation of $37.6 billion. The Bengaluru-based company’s valuation was adjusted to $33 billion after PhonePe was separated from the group.
New investors line up: Besides Walmart and other existing shareholders, new investors are also in talks to join the round, sources added.
Canada Pension Plan Investment Board (CPP Investments), the Singapore government’s sovereign wealth fund GIC, Japan’s SoftBank Vision Fund 2, Qatar Investment Authority are among Flipkart’s other existing investors.
A Flipkart spokesperson confirmed Walmart’s commitment but declined to comment on the broader fundraising talks.
Tell me more: Walmart’s $600 million committment to Flipkart comes after a significant capital infusion from the Bentonville-based retailer into PhonePe. This went into PhonePe’s funding round, and to foot the tax liabilities for domiciling the online payments firm in India.
Walmart also facilitated a $750 million one-time payout for Flipkart employees earlier this year as part of PhonePe’s recently concluded funding round as well as separation from the group.
Walmart now owns 80.5% in Flipkart following the exits of early investors like Tiger Global and Accel.
Zomato offers to acquire Shiprocket for $2 billion
Shiprocket founders (from left) Akshay Ghulati, Vishesh Khurana, Saahil Goel and Gautam Kapoor
Listed food-delivery platform Zomato has made an offer to acquire privately held ecommerce shipping startup Shiprocket, Bloomberg reported citing people in the know.
What we know: Zomato’s proposal to acquire Shiprocket values it at about $2 billion. According to sources, discussions over further investing in Shiprocket have happened at Zomato recently, but “no concrete decision has been taken”.
From investor to owner? In 2021, Zomato had picked a stake in Shiprocket during its $185-million Series E funding round, which also saw participation from Singapore’s sovereign wealth fund Temasek and Lightrock India.
Goyal had also invested in Shiprocket previously in his personal capacity, but he later exited the company.
Fundraise talks: Silicon Valley-based venture capital firm Tribe Capital, which currently owns around 15% stake in Shiprocket, is also learnt to be in discussions to invest around $75-80 million in the Gurugram-based unicorn. The round is expected to include a primary capital infusion and facilitate a secondary sale of shares by existing investors.
More about Shiprocket: Shiprocket aggregates demand from direct-to-consumer (D2C) brands, micro-entrepreneurs and local brands and sends them to logistics players such as Delhivery, Ecom Express and others. Besides shipping services, Shiprocket also offers its technology stack to retailers to integrate their shopping websites on platforms like Shopify.
For the fiscal year ended March 31, Shiprocket reported a 78% year-on-year increase in its operating revenue to Rs 1,089 crore. The firm’s net loss expanded more than three times to Rs 341 crore on account of absorption of losses from the acquisitions it made during the year.
ETtech Done Deals
Akash Gupta, cofounder and CEO, GreyOrange
Fulfilment automation startup GreyOrange raises $135 million: Homegrown artificial intelligence-driven fulfilment automation startup GreyOrange said it has raised $135 million in a round led by Anthelion Capital, formerly Cowen Sustainable Investments.
Who else participated? Besides Anthelion, existing investors Blume Ventures, Peter Thiel’s Mithril Capital and Flipkart founder Binny Bansal’s Three State Ventures also participated in the funding round.
Anmol Jaggi, cofounder and CEO, BluSmart
EV ride-hailing startup BluSmart secures $24 million: BluSmart, the Gurugram-based electric vehicle (EV) ride-hailing startup, said on Thursday that it has raised $24 million (Rs 200 crore) from its existing investors, founders, and leadership team. This is the second successive funding round for the EV startup this year.
Deal details: The funding was in the form of a rights issue, and has not seen participation from new investors. The round also saw BluSmart’s founders increasing their stake in the company. However, BluSmart did not disclose which investors have participated in the latest rights issue.
Funding environment in 2023: ET reported on December 9 that funding to Indian startups fell steeply in calendar year 2023 to $7 billion—less than one-third of the estimated $25 billion received in the previous year, citing industry data. Further, 2023 also saw the lowest level of funding since 2017.
Beauty brand Plum’s FY23 revenue rises 71% to Rs 322 crore
Shankar Prasad, founder and CEO, Plum
Direct-to-consumer (D2C) beauty brand Plum saw its total revenue rise 71% year-on-year to reach Rs 322 crore in FY23, though its net loss also widened at a similar clip.
Financial report:
- Plum saw its net loss widen 66% to Rs 52 crore in FY23, from the Rs 32 crore loss it incurred in FY22.
- Plum’s operating revenue grew 68% on-year to reach Rs 309 crore.
- Total expenses stood at Rs 375 crore in FY23, up from the Rs 219 crore it spent in FY22.
Catch up quick: Plum’s topline expansion mirrors a similar trend across D2C beauty and personal care brands. For instance, omnichannel beauty brand Sugar Cosmetics reported a revenue spike of 90% to Rs 428 crore in FY23.
Beauty and personal care brand Pilgrim’s operating revenue jumped over four times to Rs 76 crore in FY23. Notably, even beauty etailers have benefited, with Purplle seeing a 116% increase in revenue from operations to Rs 475 crore in FY23.
Growth anticipated: According to a joint study by Redseer Strategy Consultants and Peak XV Partners, India’s beauty and personal care (BPC) market is projected to grow at a compound annual growth rate (CAGR) of 10% between 2022 and 2027, surpassing global markets, to reach a size of $30 billion.
ETtech Explainer | How GenAI could breathe new life into smartphones
Thinking of buying a generative AI (GenAI) smartphone? If yes, then you’ll have to be careful while checking out a new model. Smartphone brands are expected to up the marketing hyperbole around the emerging technology, blurring the lines between what are perhaps pre-programmed responses to certain actions, and generating original content using natural language prompts.
A GenAI smartphone: According to Counterpoint Research, a GenAI smartphone is a subset of AI smartphones that uses GenAI to create original content, instead of just providing pre-programmed responses or performing predefined tasks. In short, any smartphone that has a large language model residing in its memory, which it leverages to deliver original content after being prompted by the user, is a GenAI smartphone.
Adoption of GenAI smartphones: Experts believe the smartphone industry is set to undergo a revolutionary change with GenAI devices. Counterpoint Research estimated around 40% of all smartphones, surpassing half a billion units in shipments, will be GenAI-powered, with Samsung expected to capture half of the market.
Who’s doing what?
- Google Pixel 8, using a proprietary processor, and its on-device LLM, can summarise content you have recorded using the voice recorder.
- At Lenovo Tech World 2023, Motorola showcased features such as generative theming and a sophisticated personal assistant.
- Samsung has announced its own foundational AI model called Gauss, designed to run locally on smartphones and produce text, code, and images
Today’s ETtech Top 5 newsletter was curated by Gaurab Dasgupta in New Delhi and Megha Mishra in Mumbai.
