- Udaan raised $340M in Series E funding.
- The Indian B2B startup aims for profitability in 12-18 months.
- Udaan cut costs via layoffs to balance growth and sustainability.
Udaan’s Series E Funding
Indian business-to-business (B2B) e-commerce startup Udaan has secured $340 million in a Series E funding round as it aims to turn profitable over the next 12-18 months.
The fresh capital injection, led by asset manager M&G Plc, comes amid a revenue drop and mass layoffs for the company as it focuses its strategy.
Existing investors Lightspeed Venture Partners and DST Global also participated.
Of the new funds, a portion converts existing debt into equity to strengthen Udaan’s balance sheet. The company did not disclose its latest valuation.
Profitability Goals
Udaan makes money by enabling small businesses like local shops, restaurants, and street vendors to source affordable products through its platform.
It will utilize the funding to enhance customer experience, market reach, and supply chain capabilities.
The unicorn’s revenue fell 43% to $676 million in the 2022-23 financial year as it scaled back operations in some Indian regions. In November, Udaan laid off over 1,000 employees in its second round of cuts this year.
Balancing Act
Regional e-commerce players like Indonesia’s GudangAda and Ula face similar profitability challenges, though GudangAda saw 10x sales growth.
Ula recently exited its FMCG distribution business.
With a streamlined focus and new capital injection, Udaan targets a positive cash flow milestone that has remained elusive for India’s B2B sector.
