Meesho, a social commerce start-up, has raised $125 million in investments led by Naspers Ventures, the company said on Monday. The round saw participation from Meesho's existing investors SAIF, Sequoia, Shunwei Capital, RPS and Venture Highway. Former Vodafone Group chief executive Arun Sarin has also put money.
Meesho's valuation and the percentage stake bought by Naspers were not disclosed. The four-year old start-up has raised about $200 million in external funding to date.
The announcement comes barely two months after Facebook invested in the company, in what was the social media giant's first direct investment in a domestic start-up. To be sure, Facebook acquired Bengaluru-based software start-up Little Eye Labs back in 2014.
In a press statement, Meesho said the funds will help the company attract customers in non-metro regions, which is its focus audience, bring more women sellers onto the platform, and invest in technology. Currently, the company has 2 million "social sellers" from 700 towns and cities across India. It also caters to 15,000 suppliers in traditional manufacturing hubs, offering them a new channel for sales.
"I am particularly proud that Meesho has cut across gender, education levels, risk appetites and vocations to create livelihoods for people with no investment of their own. Our social sellers are small retailers, women, students and retired citizens, with 70 per cent being homemakers who have found financial freedom and a business identity without having to step outside their homes," said Vidit Aatrey, co-founder and chief executive officer, Meesho.
Meesho, which essentially connects buyers and sellers over platforms like WhatsApp and Facebook, was started by Indian Institute of Technology (IIT)-Delhi graduates Aatrey and Sanjeev Barnwal in December 2015. The platform provides product cataloging, logistics and payment tools and is said to be the largest social selling platform in the country today. The product categories it caters to include apparel, home, wellness and electronics items.
It is believed that social commerce is the next frontier in e-commerce, mainly because it allows almost anyone to start selling online from the comfort of their homes. The model is said to be popular with women homemakers who look to make an extra buck, an audience which is also the main target of Meesho.
"Over 90 per cent of Indians either can't or won't use it in its current form. They want online shopping that enables them to buy from small businesses they trust. Meesho provides a way for these customers to get what they need, and we believe it is the future of online shopping for the next 500 million consumers," said Aatrey.
For Naspers, the deal is a major cheque in a new domestic start-up in the recent past. The Cape Town-based investment group is a large investor in PayU India, Swiggy and Capital Float, and has stakes in OLX and Byju's, among other bets.
"Globally, Naspers identifies big areas of consumer spend that have not yet been significantly disrupted by technology and India e-commerce certainly fits the bill. We were attracted to Meesho because the team have built a uniquely Indian solution that utilizes the reach and scale the internet enables, and harnesses and makes it available for small sellers to better serve customers no matter where they live, for the benefit of all," said Ashutosh Sharma, head of India investments at Naspers Ventures.
"The phenomenal growth they are already experiencing shows that Meesho has hit a sweet spot in the market and is well-poised to serve the next 500 million online shoppers in the country," added Sharma.