Grofers, an India-based online grocery startup, has raised over $200 million in Series F funding. This funding round was led by Japanese conglomerate SoftBank via the Vision Fund. South Korea-based KTB Ventures also joined this round along with existing investors Tiger Global and Sequoia Capital also joined this round.
“This latest investment will help scale the company to ensure many more customers can access the best quality products at the best prices,” said Grofers CEO Albinder Dhindsa in a statement.
This funding round is considered the largest in India’s online grocery industry. And this round of funding comes on the heels of Grofers’ rival Bigbasket raising $150 million at a valuation of more than $1 billion — which was led by Alibaba.
Originally, Grofers started as a hyperlocal grocery delivery company and then it switched to an inventory model in the last few years. But Grofers does not have fresh produce and same-day deliveries like Bigbasket does.
In an interview with Livemint, Dhindsa said that they are clear about their target audience — which is middle India that “goes after planned purchases and low-priced offerings.”
In November 2015, Grofers raised $120 million at a $400 million valuation. But then it saw an approximate 40% drop in valuation after switching from a hyperlocal services model in February 2018, according to Livemint.
With the recent substantial funding rounds, both Bigbasket and Grofers are aggressively taking on Amazon and Walmart-owned Flipkart for the online grocery space.
Grofers is now aiming for profitability as it is driving more private label offering sales. Nearly half of its sales are from private label offerings — which consists of 780 products. And it is expected to increase to 1,200 by the end of 2020.
With this funding round, Grofers is going to expand its supply chain operations. And the company is going to make its private label products available at local grocery stores over the next few months.
So far, Grofers is profitable in Delhi where it is hitting 100 crore in monthly revenue — which is about $14.41 million. Grofers is expected to become profitable overall by the end of 2021. In terms of orders, Grofers is hitting 60,000 daily orders with an average order value of 1,450 rupees (about $21).
