Meesho has raised $570 million in a new round led by Fidelity Management & Research Company and Eduardo Saverin’s B Capital after which its valuation has more than doubled to $4.9 billion in less than six months. Since the last round of funding in April, Meesho said it has raised its order volume 2.5X times and added new product categories to its roster including sports and fitness, pet supplies, and automotive accessories.
Existing investors Prosus Ventures, SoftBank Vision Fund 2 and Facebook also participated in this round. Some of the other new investors include Footpath Ventures, Trifecta Capital and Good Capital.
Meesho will use the fresh capital to double its research and development team and acquire more users. The Bengaluru-based startup will also invest a significant chunk of the capital in its grocery marketplace Farmiso, which it launched earlier this year and has been hiring for it aggressively, reported ET.
In April, Meesho became a unicorn after it raised $300 million led by Japan’s SoftBank Group Corp. The fund-raise then valued Meesho at $2.1 billion, a threefold jump from its previous funding round of $125 million in 2019 when it was valued at $700 million.
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Founded in 2015 by Vidit Aatrey and Sanjeev Barnwal, Meesho began life as a reselling platform for women entrepreneurs. This year, Meesho also started to focus on selling directly to consumers through and compete directly with Walmart-owned Flipkart and Amazon India. The startup serves as a platform for small manufacturers and distributors of fashion, lifestyle, small electronics, sporting goods and other products from unbranded or little-known producers.
Buyers on the platform are mostly middle to low income and hail from smaller cities and towns. Over four-fifths of the app’s users are from outside India’s eight biggest cities, a much greater skew than for leading online retailers. To help buyers in rural communities overcome “trust and quality” issues, the startup works with female resellers, who curate products and sell to their social and community circles.
From clocking 20 million monthly orders in March this year, Meesho had registered about 45 million orders in August. The company had 15 million transacting users in the same month. The social commerce firm is looking at an almost seven-fold increase in its monthly transacting customers taking it to 100 million by December 2022, Vidit Aatrey said.