Bengaluru-based B2B e-commerce giant Udaan has successfully raised $340 million in a Series E funding round spearheaded by M&G Plc. This latest infusion of capital also saw participation from renowned investors such as Lightspeed Venture Partners and DST Global, consolidating Udaan’s position as a leading player in the competitive e-commerce landscape.

The funding round comprises a strategic blend of equity and convertible notes, indicating investors’ confidence in Udaan’s business model and growth prospects. In a press statement, the company intended to utilize fresh capital to enhance customer experience, expand market penetration, establish strategic vendor partnerships, and fortify long-term supply-chain management and credit facilitation capabilities.

Vaibhav Gupta, co-founder and CEO of Udaan, expressed enthusiasm about the funding, stating, “… It enables our continued journey of growth and profitability, positioning us well to be public-market ready in the next 12-18 months.” While the company has not officially disclosed its post-funding valuation, industry insiders suggest that the equity component may reflect a more conservative valuation than its peak valuation of $3 billion.

Founded in 2016, Udaan has revolutionized supply chain and logistics operations with a strong focus on B2B trade, facilitating daily deliveries across more than 1,200 cities through its flagship service, udaanExpress. The platform spans various sectors, including lifestyle, electronics, home & kitchen, staples, fruits & vegetables, FMCG, pharma, toys, and general merchandise. Udaan boasts an impressive network, connecting over 3 million retailers with thousands of sellers nationwide.

Despite a dip in its gross revenue (GMV), which declined by 43.1% to Rs 5,629 crore in FY23 from Rs 9,900 crore in FY22, Udaan showcased resilience as losses contracted by 33.7% to Rs 2,076 crore in FY23 from Rs 3,132 crore in FY22, according to financial statements filed by its group company, Trustroot Internet in Singapore.

The funding comes on the heels of significant milestones for Udaan, including a $280 million extended Series D round in January 2021 and additional funding exceeding $350 million in debt and convertible notes. This influx of capital reinforces Udaan’s commitment to adapting and evolving in a dynamic market, staying ahead of the competition, and further solidifying its position as a key player in the B2B e-commerce sector.

While Udaan faced operational adjustments, including layoffs of approximately 500 employees in the past year, the company clarified that these measures were part of an efficiency enhancement initiative rather than a signal of financial distress. With the latest funding round, Udaan is well-positioned to navigate the evolving landscape of B2B e-commerce and chart a course toward sustained growth, profitability, and eventual entry into the public markets.