Flipkart’s $1 Billion Bet On India
The brainchild of two former Amazon executives founded in 2007 saw this newest massive cash injection come from existing investors – including Tiger Global Management – working with new backers: Singapore sovereign–wealth fund GIC and Morgan Stanley Investment Management. The company claims that goods worth more than $1 billion had moved through its digital marketplace over the course of the last year, making it India’s largest marketplace.
For now, Amazon is gearing up to directly compete with Flipkart on its home turf and eBay-backed local rival Snapdeal.com is starting to gain ground on FlipKart. The business, though growing rapidly, is not as of yet actually turning a profit. Nonetheless Chief Executive Sachin Bansal believes that the sky is the limit when it comes to Flipkart’s future.
“We believe that India can produce a $100 billion Internet company in the next five years and we want to be that company,” Bansal said, reports The Wall Street Journal.
The funds raised by Flipkart will largely go toward developing its mobile platform, as that is where an increasingly majority of its traffic is hailing form. As of yet the company is not considering going public, nor will it be for five to 10 years, according to Bansal.
The latest round of fundraising is Flipkart’s second this year. In May, it raised about $210 million. And Indian eCommerce explosion has been long predicted amongst analysts who cite Indian disposable income and enthusiasm for online shopping.