eBay Inc, a global online marketplace and payment leader, on Thursday announced it was leading a new $133.77-million (around Rs 830 crore) round of funding in Snapdeal even as the competition in the segment gets tougher with the rise of Flipkart.com and world’s largest e-commerce player Amazon.in.
eBay, which had led a $50-million investment in April last year with other venture funds, will raise its stake in Snapdeal. The company said it will continue to invest in Snapdeal due to its complementary business model, good management team and strong brand. After this round of funding, the total investments raised so far by the Delhi-based homegrown firm has risen to over $235 million.
The $2.5 billion e-commerce sector in the country saw more than $500 million being invested in calendar year 2013. Flipkart, which is one of the country’s largest e-commerce companies, had raised $360 million from various private equity (PE) players, the biggest capital infusion in the sector. In the first quarter of 2012, Flipkart had raised $150 million that the company did not acknowledge publicly. Amazon, which was launched in the country last year, has also been growing rapidly eroding the advantage Indian companies had with its deep pockets.
“Accelerating growth in India and other emerging markets continues to be a core strategy for driving eBay’s global e-commerce leadership. eBay is excited about the prospects ahead for both Snapdeal and the eBay India business,” said Jay Lee, senior vice-president and APAC managing director at eBay Inc.
The two online marketplace has been cooperating after last year’s preliminary investment. For instance, the partnership meant that If a product is not available on Snapdeal and is available on eBay, the consumer will still be able to buy from Snapdeal. The companies are trying to cross-sell their products to strengthen the common platform and bring in synergies and, thus, expand the demand for the merchants in both the marketplaces.
“eBay’s partnership with Snapdeal will benefit Indian businesses of all sizes, consumers and local commerce,” said Latif Nathani, the managing director, eBay India. Snapdeal had plans to clock sales of R3,000 crore in 2013 and targets $1 billion by 2015.
According to Snapdeal, the second round of investment in the company is an endorsement of its strategy and progress by the global e-commerce giant. “All our current institutional investors, including Kalaari Capital, Nexus Venture Partners, Bessemer Venture Partners, Intel Capital and Saama Capital, have participated in this round