Udaan, a unicorn in B2B e-commerce, has raised $340 million from M&G Plc. The Series E financing included participation from long time investors such as DST Global and Lightspeed Venture Partners. The company announced on December 14 that the round involves a combination of debt and equity.
However, the corporation withheld information regarding the debt-to-equity split. The corporation has converted its old and existing debt (convertible notes) into equity in addition to adding a new equity component.
Although the business remained silent on its assessment, Udaan’s valuation dropped from a peak of $3.2 billion to less than $2 billion.
The Bengaluru-based company, Udaan, plans to use these funds to improve its supply-chain capabilities, market penetration, and customer experience. According to the corporation, it would also use the additional funds to expand its loan book.
Our bank sheet is strengthened by the Series E financing, which also fully funds our business plan. In a media statement, co-founder and CEO Vaibhav Gupta stated, “It facilitates our ongoing journey of growth and profitability, positioning us well to be public-market ready in the next 12–18 months.”
Gupta previously predicted that the IPO for Udaan would occur in 2025. Although those deadlines have shifted slightly, Udaan has been drastically reducing expenses.
As previously reported, Udaan has also reduced expenses over the past year by letting rid of employees.
“We are thrilled to be of continued assistance to Udaan as it consolidates its position as the biggest EB2B platform in India. Bejul Somaia, Partner at Lightspeed Venture Partners, stated, “We think this funding puts the company on an incredibly strong financial footing and on course to further improve profitability while empowering small businesses across Bharat.”
The company continues to believe in eB2B even while competitors such as DealShare have closed their B2B divisions and are concentrating on B2C.
“M&G is glad to assist Udaan in its pursuit of a successful expansion plan. We think it has the appropriate operational framework to provide small enterprises all throughout India with technology, financial inclusion, and supply chain capabilities, making it a reliable partner of scale. Our investment approach is in line with Udaan’s goal of streamlining and boosting productivity in a crowded B2B market, according to Niranjan Sirdeshpande, (EMEA) Director of M&G Catalyst.
This occurs at the same time that Udaan, a company that supplies kirana stores with food and other goods to resell to consumers, had a 43% decline in operating revenue from Rs 9,897.3 crore in FY22 to Rs 5,609.3 crore in FY23.
In addition, the business was able to reduce its losses from Rs 3,075.8 crore in FY22 to Rs 2,213 crore in FY23.
