India-based e-commerce firm Flipkart has entered talks with a range of corporates over a funding round that could reach $1.5bn, Livemint reported today, citing three people familiar with the matter.
Software provider Microsoft, internet group Tencent, e-commerce firm eBay and online payment platform PayPal are all in the frame for the round, which would value Flipkart at between $10bn and $12bn pre-investment.
Internet and technology conglomerate Alphabet’s growth equity arm, CapitalG, is also a prospective investor according to one source, as are two undisclosed institutional investors. CapitalG already holds stakes in India-based companies CarDekho, Practo and CommonFloor.
Flipkart operates an e-commerce platform that sells a wide variety of consumer goods spanning 80 categories, and it also owns fashion portals Myntra and Jabong. It had initially aimed to raise between $500m and $1bn, but increased the target due to a recent improvement in sales.
The valuation is also a significant increase from the assessment of several of Flipkart’s investors in 2016, a fund owned by investment banking firm JP Morgan having downgraded its estimate of the company’s value to $5.54bn in November.
Flipkart was valued at $15bn as of a $700m round in late 2015 that included Tiger Global Management and Steadview Capital.
Media firm Bennett, Coleman & Co provided $38.8m in funding and advertising for Flipkart in December 2016. Microsoft’s involvement would follow the sealing of a deal yesterday that will involve Flipkart exclusively using Microsoft Azure for its cloud computing activities.
Flipkart has raised more than $3.1bn since it was founded in 2007. Its existing investors include IDG Ventures India, a venture capital affiliate of media company International Data Group, as well as e-commerce group Naspers and a range of VC and growth-stage firms.