IPO-bound Indian e-commerce platform Meesho has closed a $550 million funding round after securing an additional $250-270 million from new investors including Tiger Global, Think Investments and Mars Growth Capital according to a report by the Economic Times.
In the first tranche of the financing, in May last year, the company had raised $275 million, as per filings with the Securities and Exchange Commission (SEC).
The recent fundraise values the social commerce platform at $3.9-4 billion, a 20% cut from the valuation of $4.9 billion during its $570 million Series F funding round in 2021, co-led by Fidelity and B Capital Group.
The online marketplace has also moved the National Company Law Tribunal (NCLT) for a reverse merger of its India unit, Fashnear Technologies, with the US parent, Meesho Inc. The planned merger and the reverse flip of the startup’s base to India from Delaware, US can put some tax burden on the company, which the latest fundraise can help to offset.
The Softbank-backed company has planned to file for an IPO in India later this year and is eyeing a listing in 2026. If it goes through, Meesho will be among the first horizontal e-commerce companies to list on local bourses. The unicorn had planned for an IPO after recording its first-ever profit in the July-September quarter of 2023.
Horizontal e-marketplaces combine several markets and industries with various retailers to reach broader coverage, unlike vertical e-commerce companies that provide services in a specific industry or market.
Established in 2015, Meesho offers a wide range of products on its shopping platform that includes apparel, footwear, home decor, beauty and personal care, kitchen equipment, electronic devices and several other product categories.
The company competes with the likes of Amazon, Flipkart, and Myntra to name a few, in a fast paced and fiercely competitive e-commerce marketplace in India.
Having gained immense popularity in the smaller cities and towns, the startup’s annual transacting users reached around 175 million in 2024, with half of this user base coming from tier 4+ towns like Naidupeta in Andhra Pradesh, Sherghati in Bihar, and Harapanahalli in Karnataka. It also crossed 210 million downloads.
The growth was also reflected in the financial performance of the company as it achieved a 33% growth in revenue from operations in FY24 reaching Rs 7,615 crores. The adjusted losses of the company also narrowed by 97% during the period. It also claimed to be the first horizontal e-commerce platform to generate an operating cash flow of Rs 232 crores.