Facebook-backed Meesho nears $250 million funding from SoftBank Vision Fund, others

Facebook-backed social commerce platform Meesho is in talks to raise nearly $250 million from investors led by Japan’s SoftBank Vision Fund, multiple people in the know of developments told ET, potentially valuing the company post-money at about $2 billion.

The discussions are in the final stages, the people said requesting anonymity. ET was not able to ascertain the names of the other investors in its latest funding round. Post-money refers to how much a company is worth after new capital is in the bank.

The capital raising round is expected to more than double the company’s valuation from its previous Series D round in August 2019, when the reselling platform raised $125 million led by Naspers and saw participation from Facebook, Elevation Capital (formerly SAIF Partners), Sequoia Capital, Shunwei Capital, RPS and Venture Highway.


Meesho is the second startup after Digit Insurance to be inducted into the coveted Unicorn club—of privately held companies valued at $1 billion or more —so far this year.

Meesho and SoftBank Vision Fund did not respond to requests seeking comment till press time on Friday.

The deal comes at a time when Bengaluru-based Meesho is estimated to have largely recovered its revenues following the Covid-19 induced lockdowns last year, when investments in the sector had dipped. Industry watchers are, however, expecting more deal closures in the social commerce space this year, as avenues for building more traditional e-commerce companies have shut given the scale and size of players like Amazon and Walmart-owned Flipkart.

Meesho – which has seen heightened competition from newer entrants like Dealshare, Glowroad, Shop101 and Kiko TV - is a significant player in India’s fast-emerging social commerce sector, with over 10 million resellers and 70 million customers, according to its website.

“They (Meesho) are looking to go directly to consumers, which would mean they will compete with other ecommerce players...,” said one person in the know of the matter.

If this happens, Meesho – founded in 2015 by Vidit Aatrey and Sanjeev Barnwal -- will likely rival the likes of Amazon, Flipkart and Reliance’s Ajio.

Meesho’s resellers largely discover customers on social media apps such as WhatsApp and Instagram, while the company manages shipping and helps them in sourcing.

For SoftBank Vision Fund, the investment in Meesho comes at a time when it has placed selective bets on Indian startups, after a bunch of global portfolio firms such as co-working spaces operator WeWork hurt its performance. It has since recovered to book $8 billion in profits in the December quarter.

Meesho posted revenues of Rs 307 crore in the year ended March 31, 2020, from Rs 80 crore in the previous fiscal year, while losses surged three-fold to Rs 315 crore.