Meesho, a leading e-commerce startup in India with around 150 million transacting users, has secured $275 million in a new round of funding, the company show up in a securities depository.
The new funding is part of a larger funding round that is likely to include secondary transactions and a balloon to more than $500 million, people familiar with the matter told TechCrunch.
The Bengaluru-based startup, which operates a social commerce platform, is valued at about $3.9 billion in the round, the people said, requesting anonymity as discussions are still ongoing. The startup, which has raised more than $1.2 billion to date, was valued at $4.9 billion when it last raised funds in September 2021.
There have been a few investors that have tried to get into Meesho, including WestBridge Capital and Norwest Venture Partners. WestBridge last year bought Meesho’s shares from Venture Highway, one of the early backers. The company counts among its backers Meta, Fidelity, Peak XV, Prosus Ventures, B Capital and SoftBank.
Indian daily The Economic Times reported for the first time the new funding.
Meesho is one of the fastest growing e-commerce startups in the country. It had a GMV rate of more than $5 billion, Bernstein analysts estimated earlier this year.
Meesho has successfully captured the attention of value conscious Indians with its attractively priced, diverse and unbranded product range. The startup’s value proposition seems to resonate well with low- to middle-income customers, who make up the bulk of India’s consumer class.
With 440,000 annual transacting sellers and over 120 million listings, Meesho boasts one of the largest product ranges across all platforms, catering to the complex and heterogeneous preferences of the Indian market, Jefferies wrote in a recent note to clients. her.
Traditional e-commerce platforms in India have focused primarily on high-income consumers and branded suppliers, resulting in average order values (AOV) well above ₹1,000 (about $12). In contrast, Meesho’s AOV is usually under ₹350.
“Meesho’s algorithm prioritizes listings by considering many factors such as seller rating, product rating, customer reviews, previous customer buying behavior, product popularity, etc. Hence, pricing also affects the ability to locate a product listing on the market.” Jefferies analysts wrote.
“Meesho’s fulfillment fees are much lower than peers, which allows the platform to offer lower prices to the customer compared to the competition. To reduce costs, Meesho follows an asset-light model and outsources delivery. Meesho has almost a half share of India’s annual e-logistics 3PL shipment,” the Jefferies note said.
But the competition is heating up. Amazon India recently launched Bazaar, a ‘specialty store’ that features affordable and trendy fashion and lifestyle products.
