India’s Swiggy Raises $800 Million At $5 Billion Valuation

Indian food delivery startup Swiggy raised $800 million in a funding round led by Falcon Edge Capital and Goldman Sachs, with participation from Accel and Naspers, Bloomberg reported on Monday (April 5), citing an internal memo.

In a note to employees that was seen by Bloomberg, Co-Founder and CEO Sriharsha Majety said the funding will be used to help Swiggy expand its business interests and seed new opportunities. He also said that the convenience delivery segment will reach a half-billion users in the next 10 years.

Over the last year, “we have managed to drive a strong recovery in the food delivery business with a very clear path to profitability,” Majety wrote in the note, per Bloomberg. “The food delivery business is the strongest it’s ever been and now we are well on our way to drive continued growth over the next decade.”

The infusion of new capital boosts Swiggy’s valuation to almost $5 billion, a source told Bloomberg. The Bangalore-based startup is competing in the growing delivery sector in India against numerous companies, including Zomato, which is backed by Ant Financial and Tiger Global. Amazon also has a food delivery unit in India for its Prime members. 

The COVID-19 pandemic fueled the demand for food delivery in the country, even more so as Mumbai copes with a second wave of new cases. Overall, however, and despite the pandemic, consumer startups in India are growing fast as more of the population gets connected to the internet. Smartphone use in the country is anticipated to reach 1 billion in the years ahead, Bloomberg reported.

Swiggy raised $43 million in April 2020 as part of an ongoing Series I round. February 2020’s initial Series I round notched $113 million. Swiggy has started moving beyond food delivery and is looking to seed new businesses that address market gaps.

The startup had to lay off workers in May 2020 as the pandemic took hold, businesses closed and COVID-19 infections started quickly spreading. The company also closed some of its other businesses that were considered “highly volatile.”