The country’s largest grocery e-tailer BigBasket is in the final stages of closing $250-$300 million in Series E funding from new and existing investors. According to sources, the new round of funding could take the e-tailer’s valuation to more than double that of its previous valuation of $450 million following its last fund raise of $150 million from the Abraaj Group last March.
The six-year-old start-up is also planning to pump in $150 million into its food retail business, which will go into building its private label brands and expand its farmer connect programme, Hari Menon, co-founder and CEO, BigBasket.com, told BusinessLine . He, however, declined to comment on the company’s fresh fund raise efforts.
The e-tailer’s private label brands Fresho for fresh produce, bakery, cut veggies, batter, cookies; BB Royal and BB Popular for staples; tasties for snacks; Lindberg Gourmet Chocolates and Happy Chef for gourmet sauces, dips and ready-to-cook meal kits, contributing to 35 per cent of its revenue is expected to contribute to 40 per cent by March 2018. The e-tailer sells 600 tonnes of fresh fruits and vegetables every month, contributing to 18 per cent of its business.
“In our sixth year of doing business, where we are raking in ₹160 crore a month, we have now entered the growth phase of our journey. Having achieved ₹1,400 crore turnover in FY 2016-17 and with our projected annual turnover for FY 2017-18 at ₹2,500 crore, BigBasket will break into the top five grocery retailers in the country,” said Menon.
The company’s expansion is over, with a presence in 10 tier-I cities, including Bengaluru, Hyderabad, Gurugram, Ahmedabad, Kolkata, Chennai, Noida, Delhi, Mumbai and Pune, and a footprint in 15 tier-II cities.
The service formats including full service business of delivering customers’ large monthly/weekly shopping needs with an average of 24 items per order in slots throughout the day; the 90-minute Express deliveries of emergency purchases and top-ups; and delivering buys from local Speciality Stores for customers, are also in place.
“Fruits and vegetables is a very strategic business for us as it gives us our highest gross margins, followed by private labels. We have a six-million-strong customer base who buy on average 2.7 times a month from BigBasket. If we can get these customers to buy four-five times a month from BigBasket, then we can stop our marketing spend, which is ₹75 crore to ₹100 crore per annum,” said Menon.