Source: MarcaMoney
Business-to-business (B2B) e-commerce platform Udaan closed its Series G funding round raising a total of $114 million. The round was led by M&G Investments and Lightspeed and had participation from several existing and new investors.
This was in addition to the $75 million raised by the Bengaluru-based company in February this year as the first tranche of the Series G round. According to Entrackr’s estimate The company’s estimated valuation was around $1.8 billion at the time, which is similar to the company’s previously reported $340 million led by M&G Plc, with participation from Lightspeed and others
The capital will be used to further Udaan’s category and customer base, with an emphasis on the fast-moving consumer goods (FMCG) and hotel, restaurant, and catering (HoReCa) sectors. Udaan will also seek to ramp up its private label offerings in the staples category while also improving Udaan’s balance sheet and enhancing the company’s financial flexibility ahead of a potential IPO down the line.
“Over the last 3 years, we have transformed the business by building cost as a capability and a competitive advantage. We have reduced our EBITDA burn by 40% every year for the last 3 years and are on track to achieve full group EBITDA profitability in the next 18 months,” said Vaibhav Gupta, co-founder and CEO, Udaan.
The company stated that it exceeded 60% year-on-year growth in the calendar year ended 2024. Its contribution margin increased by over 300 basis points, and it cut fixed costs by 20%. All of this contributed to a 40% reduction on its EBITDA burn in 2024, with a further 20% reduction already being achieved in 2025.
Udaan’s gross merchandise value (GMV) barely grew in FY24, up only 1.7% to ₹5,706.6 crore from ₹5,609.3 crore in FY23, but it was able to cut its losses by 19.4% to ₹1,674.1 crore, which signals better cost control and operational efficiencies.
Udaan, which launched in 2016, is a digital marketplace that connects manufacturers, wholesalers, traders, and retailers in India. Udaan sells in a variety of sectors, including electronics, lifestyle, home and kitchen, staples, pharma, and industrial. After receiving this funding and establishing its objectives around profitability and scale, Udaan is now keen to solidify its leadership status as B2B commerce is expanding in India and is preparing for its long-awaited IPO.
With new financing, a laser-sharp eye towards profitability, Udaan is setting itself up for sustained dominance in India’s exploding B2B commerce opportunity. As it considers an IPO in the future, the market will be watching closely to see how well the company can deliver on its proclaimed rate of growth, along with the efficiencies it says it can achieve.
