B2B e-commerce platform Udaan raises $340M in a Series E round

B2B e-commerce platform Udaan has raised $340 million in a Series E funding round led by M&G Plc, with participation from existing investors Lightspeed Venture Partners and DST Global.

The funding round, which is a mix of equity and convertible notes, came after Udaan announced its plan to go public by 2025.

At what valuation?

While the company did not disclose the exact debt-equity split, Udaan's valuation has reportedly seen a decline from its peak of around $3 billion to below $2 billion.

The company has experienced a reduction in gross revenue, reporting approximately $680 million in the financial year ending March, with losses trimmed to under $380 million. However, the fresh capital infusion is expected to strengthen Udaan's balance sheet and support its business plan.

What is the purpose of funding?

Udaan plans to use the new funds to enhance customer experience, expand market penetration, and develop strategic vendor partnerships. Additionally, the company aims to improve its supply-chain capabilities and grow its loan book. 

Facing competition

Founded in 2016 by former Flipkart executives, Udaan operates across various segments, including lifestyle, electronics, and FMCG, serving over 3 million retailers across India.

Despite facing competition from major players like Reliance Retail and Amazon, Udaan remains focused on empowering small businesses with technology and financial inclusivity. The company's regional-operated design aims to make operations more agile and efficient.

Udaan's journey towards profitability and an IPO in 2025 continues amidst a challenging market environment. The company has been on a cost-cutting drive, including layoffs and organizational restructuring. 

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