Indian E-commerce Flipkart manged to procure a $1.4 billion investment from three investors, thus inducing the biggest fund-raising deal in the Indian E-commerce industry yet.
The three investors are eBay (international E-commerce firm), Microsoft (renowned technology company) and Tencent (Chinese investment holding company).
The trio constitutes the latest addition to the Indian company’s portfolio of investors, which includes the likes of Tiger Global Management, Naspers Group, Accel Partners and DST Global.
While Tencent has jumped on the wagon as a strategic investor, eBay’s investment includes a strategic commercial agreement, wherein it will be handing over its Indian division to Flipkart (along with some investment in cash) in exchange for a stake in the equity.
Simply put, the Indian division of eBay would still continue to function as an independent entity, but as a part of Flipkart (from now on).
Though the deal is indeed one of landmark stature, it has not particularly rained money on Flipkart, instead, the Indian company had better funding according to the figures in its last funding round (2015).
During that round, the company finished off with a value of $15.2 billion, while after this one, it stands valued at $11.6 billion.
It would be worthwhile to mention here that the company has lost about 23% in value after its last big funding round, where it managed to garner an astounding $700 million (July 2015).
“This is a landmark deal for Flipkart and for India as it endorses our tech prowess, our innovative mindset and the potential we have to disrupt traditional markets. It is a resounding acknowledgement that the homegrown tech ecosystem is indeed thriving and succeeding in solving genuine problems in people’s daily lives across all of India,”
– Sachin Bansal and Binny Bansal, Founders, Flipkart