Flipkart, the homegrown e-commerce marketplace, has today raised a massive $2.5 billion funding from SoftBank Vision Fund. The investment is a mix of primary and secondary capital. This is the largest funding round ever raised by an Indian startup.
After the funding round, SoftBank becomes the largest shareholder in the Bangalore based e-commerce startup. The round will also give a partial exit to its one of the largest investor — Tiger Global Management.
This new funding round is following a massive $1.4 billion round that was raised in April this year from Microsoft, Tencent and eBay. Thus, the funding raised by the company in this year so far stands at $4 billion.
This is a major advantage for Flipkart as it is now equipped with what seems like more than enough capital in its battle against Amazon India for a majority of share in the Indian eCommerce market.
Commenting about this funding round, Flipkart co-founders Binny Bansal and Sachin Bansal said in a statement:
This is a monumental deal for Flipkart and India. SoftBank’s proven track record of partnering with transformative technology leaders has earned it the reputation of being a visionary investor. We’re excited to welcome the Vision Fund as a long-term partner as we continue to build our business with a focus on serving the needs of all Indians, and driving the next phase of technology adoption in India.
Earlier, SoftBank was pushing for a merger of Snapdeal — the eCommerce company in which SoftBank holds majority stake. As a part of the merger deal, SoftBank was going to invest significant amount in Flipkart. That was said to be the reason for Flipkart being interested in the deal.
However, Snapdeal co-founders rejected Flipkart’s $950 million acquisition offer. After the deal got terminated, SoftBank CEO Masayoshi Son had said that they would engage with Flipkart independently.
In a statement, SoftBank CEO Masayoshi Son said:
India is a land of vast opportunity. We want to support innovative companies that are clear winners in India because they are best positioned to leverage technology and help people lead better lives. As the pioneers in Indian e-commerce, Flipkart is doing that every day.
This investment marks second major funding this year in an Indian startup by SoftBank. Earlier this year, SoftBank pumped in $1.4 billion in Paytm at a valuation of over $7 billion.