Zomato raises $103 million from Tiger Global, closes in on Swiggy
With this $103 million, Zomato’s valuation has shot up to $3.4 billion from $3.25 billion.
Zomato has raised $103 million from Tiger Global, the New York-based investment firm. These funds are a part of Zomato's ongoing Series-J financing as per regulatory filings.
According to reports, Zomato has allotted 25,313 class J4 preference shares to Tiger Global's Internet Fund IV Pte. Ltd at an issue price of ₹3,00,235 per share, regulatory filings sourced from Tofler showed.
With this $103 million, Zomato's valuation has shot up to $3.4 billion from $3.25 billion. This helps Zomato close in on the gap it has with rival Swiggy that was last valued at $3.6 billion. Swiggy raised $156 million just in the March quarter of 2020 from Naspers and others.
Zomato is all set to go public by next year and these the ongoing efforts to attract investors and raising funds is the last attempt before that happens.
In an email to employees on Thursday, founder and CEO, Deepinder Goyal told said that the company is looking to go public, by mid-next year, in 2021. Mint has reviewed a copy of the email.
“We have raised a lot of money, and today, our cash in the bank (~$250m) is more than ever in our history. Tiger Global, Temasek, Baillie Gifford and Ant Financial have already participated in our current round, and there are more big names joining the round – we estimate that our current round will end up with us at $600m in the bank very soon," Goyal wrote
Zomato will be using this money as cash reserves to fight price competition in the market, as well as look at potential acquisitions by which it can boost its food delivery capabilities.
“The best part is that our burn rate is very low, and our market share is accelerating in all regions […] we have no immediate plans on how to spend this money. We are treating this cash as a ‘war-chest' for future M&A, and fighting off any mischief or price wars from our competition in various areas of our business," Goyal added.
This investment from Tiger Global comes a week after Zomato closed a $62 million funding from MacRitchie Investments Pte. Ltd., a unit of Singapore's state investment arm Temasek Holdings. Earlier in March this year Zomato raised $5 million from Pacific Horizon Investment Trust, which is managed by UK-based Baillie Gifford & Co. Ltd.
Following that, in July this year, Zomato said that its revenues had doubled to $394 million, although it recorded a loss of $293 million, for the fiscal year 2019-20. In FY19, they had reported a revenue of $192 million and a loss of $277 million.