Matrix-backed DealShare raises $144M

Bengaluru, 8th July, 2021: DealShare, India's fastest growing social e-commerce startup known for pioneering the community group buying (CGB) model in India, has announced that they have raised $144M in their latest funding round. The round was led by Tiger Global and was co-led led by WestBridge Capital, Alpha Wave Incubation (a venture fund backed by ADQ, and managed by Falcon Edge Capital) & Z3Partners with participation of DST Global, Matrix Partners India, and Alteria Capital. This transaction marks the third funding for the company in a span of seven months, with the valuation increasing nine-fold on the back of high growth momentum. With the current round, the total funding raised by DealShare stands at $183M

DealShare has built a new disruptive retail model for India with a focus on the affordability & price component for the mass consumers. It offers high-quality, low-priced essentials coupled with a gamified, fun and virality-driven vernacular shopping experience that makes it easy for first-time internet users to experience online shopping. Founded by Vineet Rao, Sourjyendu Medda, Sankar Bora and Rajat Shikhar, DealShare provides a sharp and curated assortment at highly competitive prices and has built an innovative community leader driven ultra-low-cost delivery mechanism collectively leading to best-in-class unit economics.

Commenting on the fundraising, Vineet Rao, CEO and Founder, DealShare, said, "We believe India is a unique market with its highly diverse demographics and requires an indigenous model that is built based on first principles and differentiates itself from western and Chinese e-commerce models. DealShare has pioneered this model with innovations in app experience and technology, direct from factory procurement, gamified and viral demand generation and building a DealShare dost (community leader) network that enables DealShare to operate at the lowest cost operations in the world. We are proud to have a strong team of innovators who love to continually learn consumer behavior and solve hard business problems. This has enabled DealShare to rapidly grow to $200M GMV ARR.

We would be utilizing the funds primarily to invest in AI-driven innovations in our user experience leading to a highly personalized, fun-filled and gamified experience. Our monthly active users already use our app over 40 times a month making it the most engaging e-commerce app and we will continue to add more innovative capabilities and services to serve a wider range of user needs. We will also invest in improving and scaling up our operations rapidly. We expect our footprint to increase from 20 warehouses across 5 states to over 200 warehouses across 10 states by the end of this year', added Rao.

"We are excited to partner with DealShare as they grow the Indian E-commerce market. DealShare's unique approach combines discovery-led social sharing, group buying, and a gamified shopping experience with a simple consumer interface. They are well positioned to power the next wave of Indian e-commerce growth', said Griffin Schroeder, Partner at Tiger Global.

Sharing his views on the fundraising and the growth trajectory of the company, Sourjyendu Medda, Founder, Chief Business Officer and Chief Finance Officer, DealShare, said, "The funds will be used to augment our current growth trajectory. In FY 20-21 fiscal, we grew 5X to reach $200M Annual GMV run rate. In a short span of 2 years, we have serviced more than 3 million consumers and over 20 million orders. We are confident of hitting a $1B GMV run rate by end of the year thereby building a strong 10 million customer base. We currently serve 40 cities and towns across 5 states and will increase our footprint to 100 cities & towns and 10 states by year end.

Since the very first day, DealShare has been focused on developing indigenous brands across states and has enabled them to grow exponentially. We are the only retailer in the country building a unique and large network of local manufacturers in the grocery space enabling them to compete with large multi-national brands. We are truly aligned to further our country's mission of Make in India and the cherry on the top is that we are very close to breakeven', added Medda.

Sandeep Singhal, Co-founder, WestBridge Capital said, "We are very impressed with the traction that DealShare has been able to achieve especially amongst first-time internet users in the hinterlands of the country. We are confident they will be able to scale up further with the new round of funding.'

"We currently have over 1000+ micro-entrepreneurs partners promoting the community group buying (CGB) model in the country thereby generating a massive amount of employment opportunities across all tiers of cities and towns. We plan to strengthen our network further and increase it to 5000+ by this year-end. Along with this, we are planning to fuel the growth by building State-of-the-art technology and infrastructure-related assets which will ensure efficiency', added Sankar Bora, Founder, Chief Operation Officer, DealShare.

"We invested in DealShare in its seed days and have seen the company grow rapidly, while consuming minimal capital - a refreshing change in an industry plagued by heavy capital consumption. DealShare demonstrates best-in-class unit economics and capital efficiency (5.0x+), while delivering a compelling value proposition to its customers, value-conscious middle Indians in Tier 2 and 3 cities who crave local / regional products. DealShare is constantly iterating and improving its playbook of viral customer acquisition through group buying and gamification, while driving steady retention / cohort and unit economic improvements. DealShare's best-in-class fulfilment capabilities allows it to deliver this value proposition at attractive unit economics. Today, DealShare is a business that expects to break-even in the next 12 months. The company will also expand internationally, starting with the UAE and is establishing its first base in Abu Dhabi. We are thrilled to continue backing DealShare, across rounds', added Navroz Udwadia, Co-Founder and CEO, Falcon Edge Capital.

Rajat Shikhar, Co-founder, Chief Product Officer, DealShare, said, "Building scalable technology amounts to solving some hard problems and technical challenges, that are posed by our unique target group of Bharat users. Key problems revolve around savviness, efficient logistics, and making shopping convenient, cost-effective and fun with social engagement, personalization and gamification.

This round of investment would help us continue to build a top-notch team and build a highly performant platform by which we will scale to the next level of evolution as a company."

Tarun Davda, Managing Director, Matrix India, commented, "Matrix has had the privilege of co-leading DealShare's Seed & Series A rounds along with Falcon Edge. This fundraise is a testament to DealShare's exponential growth and capital-efficient business model, which uniquely serves the needs of Tier 2/3 consumers that are embracing online grocery shopping like never before! We are delighted to be re-investing in the DealShare team once again and wish the team all the very best as they seek to transform the social-commerce landscape in India, and we welcome Tiger Global to the partnership.'

Avendus was the exclusive financial advisor for this transaction.

About DealShare:
DealShare is an incredibly disruptive e-commerce model objectified towards re-inventing e-retail for the next billion internet users. Currently, DealShare is present in 40+ cities and towns across Rajasthan, Gujarat, Maharashtra, Karnataka and Delhi NCR and it plans to expand to 100+ cities in 2021. The company has acquired more than 3 million consumers and adding lacs of new consumers every month. DealShare caters to about 1 lac orders on a daily basis. Since their inception, their focus has been to procure products from local manufacturers and provide them with a platform to digitize their business and compete with lead brands. At present, DealShare has partnered with over 1000 local and regional brands. For more information, visit: https://www.dealshare.in

About Matrix Partners India:
Matrix Partners India is an investment firm with approximately $1 billion under management. Founded in 2006, the firm invests in companies targeting the Indian consumer and enterprise market at the seed, early, and early growth stages. Matrix India has invested in several market-leading companies such as Ola (mobility), Dailyhunt (mobile local language platform), Mswipe (mobile POS), Five Star Business Finance (SME lending), OfBusiness (credit led B2B marketplace), Ola Electric (electric vehicles), Razorpay (payments), Stanza Living (tech-enabled student housing platform), OneCard (mobile-first credit card), Country Delight (D2C dairy & fresh foods brand), DealShare (social commerce platform), Bijnis (digital B2B marketplace), Captain Fresh (Seafood marketplace) and Cloudnine Hospitals (leading chain of maternity hospitals) among others. Matrix India has advisory offices in Bangalore, Delhi, and Mumbai. Matrix Partners has a global network of funds investing in the US, China, and India, with approximately $5 billion under management. Further information is available at www.matrixpartners.in. To know more about our investment philosophy & ideologies, check out the #MatrixMoments podcast series.