Foodtech unicorn Zomato has raised $100 million in funding from Internet Fund VI Pte Holdings, Tiger Global’s Singapore investment arm, according to filings with the Registrar of Companies (RoC) accessed by YourStory.
With the latest fundraise, Zomato is now reported to be valued at $3.4 billion, close to its rival Swiggy which is presently valued at $3.6 billion, according to media reports.
The RoC documents also revealed that the investment made into the Gurugram-headquartered foodtech startup will be used to expand its business, and support overall corporate purposes.
According to media reports, Zomato is also eyeing an Initial Public Offering (IPO) in 2021.
In an email to its employees, Zomato CEO Deepinder Goyal said that the unicorn has raised a lot of money and has $250 million cash in the bank — which is more than ever in Zomato’s history. He also noted that Tiger Global, Temasek, Baillie Gifford, and Ant Financial have already participated in its current round, and more big names will be joining the round, which will end up Zomato with $600 million in the bank very soon.
He added that this cash is being treated as a ‘war-chest’ for future M&A, and fighting off any ‘mischief or price wars’ from Zomato’s competition in various areas of its business.
An official confirmation on the IPO from Zomato is awaited at the time of publishing this news.
In July, Zomato estimated its burn-rate to be under $1 million, and revenue at close to 60 percent of pre-COVID-19 peaks of $23 million per month. “We expect to make a complete recovery over the next three to six months while continuing to maintain tight control on costs/profitability,” it said in its report.
It also added that Zomato’s FY20 India food delivery GMV grew by 108 percent over FY19. However, when the rise of COVID-19 cases started in March, Zomato’s food delivery business GMV was down by 80 percent as compared to its peak in February. It also acquired UberEats’ India vertical in January.
“We expect a sharp recovery in our order volumes as lockdowns continue to ease and the operating environment continues to improve. The unit economics of our food delivery business has improved consistently over the last 18 months. In Q1 FY20, we used to make a contribution margin of negative Rs 47 per order; in Q1 FY21, we made a contribution margin of positive Rs 27 per order,” said Deepinder Goyal, Co-founder and CEO, Zomato, in the report.