Bangalore based Flipkart.com has received a funding of $200 million (Rs 1,200 crore) from four of its existing investors – Hedge fund Tiger Global Management LLC, venture-capital firm Accel Partners, South Africa-based media company Naspers and U.S. investment adviser Iconiq Capital LLC.
The deal values Flipkart at $1.5 billion, or over Rs 9,000 crore, according to a person with direct knowledge of the deal. “There was a lot of scepticism about Flipkart and e-commerce in India. This funding refutes that,” said Sachin Bansal, chief executive of Flipkart who co-founded the company with Binny Bansal in 2007.
The company plans to utilize the funds to improve its technology capabilities, logistics chain and staff strength as it shifts to a marketplace business model, where retailers use the online platform to sell brands to customers directly. The marketplace model will be cheaper compared with Flipkart’s current business model of first buying the products it sells through its website.
The Bansals, first met as undergraduates at IIT-Delhi and worked together at Amazon’s India office before they launched Flipkart.