E-commerce startup Meesho has secured $275 million in a recent funding round, as revealed by a regulatory filing with the US Securities and Exchange Commission (SEC). The funding, achieved through primary and secondary share sales, marks a significant milestone for the Bengaluru-based company.
According to media reports, this funding is part of a larger round estimated to be between $500 million and $600 million, potentially valuing Meesho at $3.9 billion. Although the SEC filing did not disclose the participating investors, Meesho has attracted substantial support from Softbank, Prosus, Peak XV Partners, and Elevation Capital, among others.
The Economic Times reported that new investors will likely join the $200 million follow-on round, indicating continued investor confidence in the social e-commerce platform.
Earlier this year, US asset management company Fidelity Investments reduced the valuation of its stake in Meesho by 33% to $3.5 billion. Meesho attributed this to the increase in outstanding shares, mainly due to the expansion of its ESOP pool. Nonetheless, before this valuation adjustment, investors and analysts were optimistic about Meesho’s performance, with research firm Bernstein citing it as one of India’s fastest-growing e-commerce companies.
Meesho has emerged as a formidable contender against e-commerce giants like Amazon and Flipkart in India. It boasts near-zero cash burn and a path towards EBITDA breakeven. The company’s success lies in offering better-valued products in a price-sensitive market, despite competition from quick commerce startups and government-backed initiatives like ONDC.
According to reports, the latest funding round and subsequent rounds could see exits from pre-Series A investors. Additionally, Meta has been approached to offload some of its stake in Meesho, further indicating the company’s attractiveness to investors.
Meesho’s continued growth trajectory underscores its ability to navigate the dynamic landscape of India’s e-commerce sector, positioning itself as a key player in the country’s digital economy.
