Grofers raises $35 million to fund expansion
Mumbai-based on-demand grocery delivery company Grofers has raised US$35 million in its latest funding round. Lead investors included Tiger Global Management and Sequoia Capital, which both also committed to the US$10 million funding round that Grofers completed earlier this year.
Grofers said that the new funds will help to expand the selection of products that consumers can purchase from the Grofers Android and iOS mobile apps.
The company is reportedly working with more than 400 merchants in Bengaluru, Delhi NCR and Mumbai. Customers can use the service to buy products ranging from grocery to pet supplies and baby care products and receive them within 90 minutes. Grofers anticipates that it will be extending its service to Hyderabad and Pune by mid-May.
The company was started by Saurabh Kumar and Albinder Dhindsa late in 2013 and is now valued at over US$110 million.
Several other Indian on-demand logistics startups, including Gurgaon’s PepperTap, Mumbai-based Scootsy, Bengaluru’s Swiggy and Delyver, have also been raising funds recently, according to local reports.
Dhindsa said that the company needed the funds to pay for expansion and also to prepare for the stiff competition from big players who now recognize the full potential of the “hyper local grocery” business.
“Competition is coming from Flipkart and Amazon, so that is what we need to prepare for,” said Dhindsa. “They have the financial muscle to really give us a fight. We have the leadership in this space now, but they have the financial power to outrun us quickly. We just have to run faster than them.”
Interestingly, Tiger Global Management is also a major investor in Flipkart, which was established in 2007 by Sachin Bansal and Binny Bansal and is now valued at US$11 billion.
As reported by PostandParcel earlier this week, Flipkart has recently started working with Mumbai’s “dabbawalas” (or lunch pail delivery men). Meanwhile, Amazon India last month launched its Kirana Now service, which delivers a range of “everyday-need consumer goods” from local convenience (kirana) stores “within 2-4 hours”.
