[Funding alert] Bigbasket raises Rs 100 Cr venture debt financing from Trifecta Capital

Alibaba-backed online grocery platform Bigbasket has raised Rs 100 crore venture debt funding from Trifecta Capital.

Owned and operated by SuperMarket Grocery Supplies Pvt. Ltd., the Bengaluru-based startup said in an official statement that it will use the funds to meet the working capital and capex requirements of the company, including setting up new warehouses, strengthening the cold chain, and setting up facilities for reprocessing of fruits and vegetables. The capital will also be deployed towards scaling-up of its supply chain for the recently launched milk subscription business - BB Daily, and its specialty vending machine business - BB Instant. 

Commenting on the investment, Hari Menon, Co-Founder, Bigbasket, said,

“We have a clearly identified use case for debt. We are present in 26 cities and continue to optimise our supply chain. A significant part of our business is fresh fruits and vegetables, the bulk of which is sourced directly from farms. It is crucial that we maintain the quality right up to the last mile. Funding such capex requirements is best done through debt.” 

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Founded in December 2011 by Abhinay Choudhari, Hari Menon, Vipul Parekh, VS Ramesh, and VS Sudhakar, Bigbasket claims to be one of the largest online food and grocery players in India with operations spread across 26 cities. It offers an online assortment with 19,000 plus products and 3,000+ brands across fruits, vegetables, staples, meat, beverages, and personal care categories. 

The company, which sources fresh fruits and vegetables directly from farmers, is backed by marquee investors like Bessemer Venture Partners, Helion Ventures, Ascent Capital, Sands Capital, Alibaba, CDC, and Mirae. 

Nilesh Kothari, Co-Founder, Trifecta Capital, added,

“Bigbasket is the largest online grocery brand in the country. The five founders have significant offline and online retail experience. They have leveraged economies of scale, technology, supply chain and logistics, backward integration and product mix to create a viable, high growth business that is delivering significant value to its customers."

Bigbasket has raised close to $1 billion funding so far. This year, it raised $150 million in its Series F round from South Korea’s Mirae Asset Global Investments, UK government’s development finance institution CDC Group, and the Alibaba Group, and marked its entry into the unicorn club at a valuation of $1.2 billion.

Interestingly, this was the first investment in an ecommerce company by Mirae Asset Global Investments, an asset management company in South Korea.

In February 2018, the company announced a funding of $300 million from Sands Capital, International Finance Corporation, Abraaj Group, and Alibaba. 

According to RedSeer Consulting, India’s online grocery space is worth $1.2 billion, and is expected to grow at 50 percent for the next few years.

Bigbasket, which claims to have generated Rs 3,200 crore in revenue in FY19, aims to generate almost double that amount – Rs 6,300 crore – this year. 

In a conversation with YourStory recently, Hari Menon said there is no pressure on the company for an IPO or exit from investors.

“But we have internally said that we will operationally break even in all 26 cities by the end of this year. We will have no cash burn and will need money only for new businesses, that is BB Instant and Daily. They will take another year to break even. But our normal standard business will not need money anymore,” he added. Menon expects BB Instant and BB Daily to contribute 15-20 percent of the business.

Since 2015, Trifecta Capital has supported over fifty companies including PaperBoat, Rivigo, UrbanClap, Box8, Livspace, Cure.Fit, CarDekho, Pharmeasy, NinjaKart, Sigtuple, Cars24, and NoBroker among others.

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