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Swiggy raises $1.25B at $5.5B valuation

Mumbai | Bengaluru: Swiggy had given rise to $1.25 billion from SoftBank Vision Fund II and existing investors Prosus, Accel and Wellington Management, in its biggest funding round since inception.The online food ordering scaffold is now evaluated at $5.5 billion, as ET reported earlier.The fundraising was done in two tranches :$ 800 million, which come back here brand-new investors such as Qatar Investment Authority, Falcon Edge Capital, Amansa Capital, Goldman Sachs, besides participation from Prosus and Accel. ET reported under this in February .$ 450 million was ploughed in by SoftBank Vision Fund II, which had delayed a wager as it assessed the online menu bringing gap for a few years, ET firstly reported on April 15. 8458189 0The announcement of the fundraising comes eras after arch challenger Zomato Ltd.’s initial public offering( IPO )-- the first by an Indian unicorn--was agreed more than 40 times.According to Swiggy’s cofounder and chief executive Sriharsha Majety, the foodtech startup will use the new asset to aggressively invest into its non-food horizontals, extremely its hyperlocal grocery busines Instamart.Majety told ET that while Swiggy’s food delivery business evidenced a sharp decrease in volumes in the early days of the Covid-1 9 pandemic last year and then recovered, the impact was not as pronounced during the second gesticulate of infections this year. In fact, in evaluate expressions, the menu transmission business is now 30% bigger than pre-pandemic levels.“The food delivery business had significantly improved in unit financials profile, and, with clear itineraries to profitability, that's one field where we'll continue to invest and grow more awareness to build on what we have. A substantial part of the investments will be made in our non-food wagers like Instamart, ” Majety said. The funds will also be used to hire tech talent and explore M& A opportunities, he said.Beyond food deliveryAccording to Majety, 25% of Swiggy’s revenue comes from the non-food delivery business, whose swelling trajectory is only going to track upwards in the next five years.Besides Instamart, which is now fully operational in Bengaluru and Gurugram, Swiggy also races a separate platform Supr Daily, which it acquired in 2018. Supr Daily is a subscription-based platform for daily transmission of criticals in the morning. It participates with BigBasket’s BB Daily in this space, besides recent entrants like Reliance’s JioMart which is piloting this service in select cities. Besides, Swiggy imparted a soft open for Instamart in Mumbai recently.For the Bengaluru-based startup, the $1.25 -billion fund round is significant as it makes on board an influential engineering investor like SoftBank Group Corp. The Masayoshi Son-led Japanese company had been assessing both Zomato and Swiggy for an investment for some years, but decided on Majety’s firm due to its grocery intentions, beginnings told ET.“We've always goal Swiggy not as a food transmission but as the last-mile convenience and logistics player with an unparalleled competitive advantage, ” said Sumer Juneja, spouse at SoftBank Investment Advisers. “Instarmart, which is the largest model after food delivery in the cities where they've been active for more than 6-9 months and reached some sort of scale in gang economics, is moving uncommonly better than what, say food give, was moving at the same scale.”Majety added that hyperlocal business like Instamart and Supr Daily are building on the liquidity of the fleet, which stirs the cost of servicing their customers relatively lower.Focus on essentialsOwing to the pandemic, is asking for indispensables online is growing steadily. Horizontal etailers like Amazon India and Flipkart are scaling their grocery business while horizontal scaffolds like BigBasket are adding new provides. On July 19, ET reported that BigBasket, which are currently owned by Tata Group, is planning to bring back express transmissions -- commonly within an hour -- after years of experiments in this vertical. Grofers too has raised $120 million from Zomato and Tiger Global. JioMart is also scaling up enterprises with Reliance investing in its brand-new industry speculation through this platform.“Grocery itself has been of interest to all the players. Over the last five-six years, everyone was taking different approaches--some were working, some were not. It is still super early if you look at grocery overall I think there will be a lot of investments and a good deal of coin going in, ” Majety said.Swiggy will concentrate on the metropolitan marketplace and not value-based groceries or monthly stocking.“We are focusing on the amenity vector--whether it is getting it in 30 hours or going it the next morning--and we will go after the daily( and) weekly top-ups as a huge focus ..., ” Majety said. ”..we witnes these are two horizontals where there is a reason to win available and the opportunity for us to be the governor and be profitable exists, and that's I guess also why we're realizing the play.”“But I think you will then have to think about the different parts of grocery and we'll have to time weed out who is playing in what, ” he added.Swiggy Direct and NRAIIn recent weeks, The National Restaurant Association of India( NRAI) has registered individual complaints and testify with India’s antitrust regulator, alleging that food delivery stages Zomato and Swiggy charge exorbitant commissions and are forcing restaurants to give discounts.ET reported last week that Swiggy was piloting a direct-ordering product--Swiggy Direct.“We have always been talking with the restaurant spouses and will continue to talk with the partners on what the issues are and what we can do. We are committed to them, and Swiggy Direct is a pilot in one such counseling, ” Majety said.High-profile exitsSoftBank has backed Swiggy amid a leader churn at the Bengaluru-based startup. Last week, the company heightened Phani Kishan, vice president of programme and investments, to the position of cofounder. On June 30, COO Vivek Sunder, who was responsible for the company’s expansion into more than 500 metropolitans, resigned to pursue other interests.Majety will take over from Sunder, who will transition out by October. “I will be immediately overseeing the marketplace business with immediate effect, ” Majety wrote in an email to employees then. “We have been discussing this for a while now, and over such courses of the past few weeks, have been planning the way forward as well.”

Read more: economictimes.indiatimes.com


[The Turning Point] How Grofers, a unicorn in the making, was started to transform India’s unorganised grocery landscape

Grocery delivery startup Grofers, the next unicorn in the making, was founded by Albinder Dhindsa and Saurabh Kumar in December 2013. It was started to solve the on-demand pick-up and drop-off services for Indian purchasers in cooperation with regional storages, which were struggling to solve this problem.

Interestingly, Albinder Dhindsa is an ex-Zomato administration. In the initial years of starting Grofers, he had shared with YourStory that they never planned to get into the food delivery space.

The journey

After completing his graduation from IIT Delhi, Albinder went to work in the US where he met Saurabh. The duo used to work in the transportation and logistics field and worked on quite a few projects together.

Later, Albinder left his occupation to get an MBA from Columbia University and then assembled Zomato. Meanwhile, Saurabh was trying his hands with entrepreneurship. After graduation, he went on to work in a few corporate setups before opening the startup world with Rasilant in 2011 as the COO.


Albinder Dhindsa, Co-founder, Grofers


Zomato approaches CCI for acquiring 9.3 pc stake in Grofers

In 2013, Saurabh started Onenumber. The initial opinion was to provide on-demand pick-up and decline service from neighborhood shops. They started out with pharmacy shops, grocery browses, and diners, but promptly discontinued diners as there was a lot of competition.

Saurabh, who was based out of Gurugram then, spoke to a lot of sellers and realised the agony pitches these supermarkets had with delivery logistics.

“I was surprised to be recognised that regional pharmacies did 50 -6 0 home deliveries in a daylight within three to four km radius! ” says Saurabh. This become the eureka moment. Taking a cue from this, he instantly pivoted and rebranded the company as Grofers.

While Saurabh had started working on Grofers, Albinder initially assembled the project part-time. After seeing the opportunity in the hyper-local space, Albinder decided to join full time in 2014 as a co-founder.

“Saurabh and I had started working on this idea in December 2013 with the goals that I will ultimately join full time. I wasn’t looking at moving out of Zomato, but the opportunity in the hyper-local space was very exciting and I definitely wanted to try and build something in the area. The part Zomato team was very supportive and cured compile transition periods awfully smooth, ” shares Albinder.

Recently, Saurabh Kumar stepped down from his operational capacities at the company and said he will only be a shareholder and a board member. Now, circling back to Zomato, Albinder-run Grofers is going to anytime become a unicorn with Zomato’s investment into the company.

From e-grocer to grocery ecosystem

Grofers had a humble beginning in a browse in Sushant Lok, Gurugram, and the initial doctrine was to articulated a website for local needs. But it didn’t work.

“We have made a lot of mistakes before arriving at a viable business proposition, ” says Albinder. By January 2014, the company started delivering grocery and FMCG goods for businesses in Gurugram with four delivery boys. Within 15 months, the Sequoia-funded venture scaled to 200 on-field delivery boys and 40+ beings in tech, action, and market units.

Over the years, the consumer app has progressed to service entire household needs. Now, the SoftBank backed e-grocer, which is focusing on private label products to drive overall auctions raise, is expecting its gross product importance( GMV) to grow 4X to around Rs 30,000 crore by 2022.

The company entered$ 1 billion in GMV( total value of product sold over a span) in the financial year 2020 and is currently under way to double it every year. The duo concludes if you have a good commodity, useds will simply find you.

Edited by Megha Reddy

Read more: yourstory.com


No hikes, but more perks and performance-linked pay for blue-collar workers

Wages for blue-collar workers have largely stayed where they were last year, but employees are getting some respite now in the form of joining perks and more performance-linked pay.Companies in ecommerce and logistics are reducing their fixed costs by not hiking salaries and, instead, giving out bigger performance-linked incentives, according to recruitment firms such as Betterplace, Waah Jobs, TeamLease and ManpowerGroup.A delivery person, who got paid around Rs 8,000-12,000 as base pay, could earlier make Rs 5,000-6,000 as incentives. Now, the potential incentives have gone up to Rs 10,000-12,000, said Olive Sen, head of product and marketing at Waah Jobs and OLX People. Waah Jobs has about 4 lakh vacancies listed on the platform.Twice as many companies are now offering performance-linked incentives compared with last year, said Sen.While it was usually food-tech companies such as Swiggy and Zomato that offered these pay structures, traditional companies such as pharmaceutical firms, telecom companies and even some public-sector undertakings are planning to introduce it, he said. This is because of the introduction of the PLI (production-linked incentive) scheme, which the Union Cabinet had approved in November last year to promote local manufacturing.With the IPL cricket tournament coming up, more people are expected to order in. That’s why food delivery companies are willing to offer 40-50% increase in the joining bonus, said Pravin Agarwala, chief executive of Betterplace, which provides workforce management solutions for companies hiring blue-collar workers. Delivery persons can now make Rs 5,000-10,000 as joining bonus, depending on the location and company. Betterplace on-boards about 1.3 lakh blue-collar workers each month.About five months ago, Betterplace started giving out bikes on rent or EMI to delivery persons. It has so far given out a few thousand bikes. A popular pizza delivery chain, too, is offering bikes and petrol to delivery persons and paying them on a per-delivery basis.Mobile phone companies, meanwhile, are increasing incentives for in-store promoters.“Variables are going to the extent of 30% as compared to 10-15% in pre-Covid days… It’s increasing their earning potential by 20-25%,” said Alok Kumar, senior director of sales, account management and global accounts at ManpowerGroup India. 81424273Why is this model picking up? Companies are paring fixed costs in a bid to become more profitable. Kumar said despite positive indicators pointing to an economic recovery, companies are still sceptical about salary increases.The performance-linked model reduces risk in the event of an economic downturn. At the same time, workers can make more money when they perform well and when the company makes money.In the manufacturing sector, wages have moved up 3-6% only because of the revision in minimum wages. However, companies are doling out perks which include joining bonuses, free meals, and even rent for a few months of stay in sanitised paying guest accommodation for workers who move to industrial townships.In-demand skilled workmen such as fitters, bar benders and masons are being offered a 3-5% increase in wages, along with the cost of travel and stay, said Sudeep Sen, business head for industrial manufacturing and engineering at TeamLease Services. In the Sriperumbudur Industrial Area in Tamil Nadu, for instance, companies are offering “rehabilitation contribution (pay hike) and also attendance bonus and performance linked incentives".

Read more: economictimes.indiatimes.com