Anand Piramal invests in Snapdeal

Anand Piramal, executive director of Piramal Group, has invested an undisclosed amount in Jasper Infotech, which owns e-commerce marketplace Snapdeal. The investment was made by Piramal in his personal capacity.

Jasper bought out early investors Kalaari Capital and Bessemer Venture Partners in 2018 and had converted all shares into equity in a capital restructuring move. 

The company recently reported a 73% growth in consolidated revenue at Rs 925.3 crore for the financial year 2018-19 compared to Rs 535.9 crore in 2017-18. The company also managed to cut its losses by 71% to Rs 186 crore.

“Snapdeal’s sharp execution in bringing great selections to the mass market segment in tier 2-3 cities has been quite successful, leveraging the growing Internet penetration in these geographies,” Piramal said in a statement. “The company’s mission of enabling the success of hundreds of thousands of small businesses in India through its marketplace is commendable. Since 2017, Snapdeal’s revenues have grown rapidly with profitable unit economics. With hundreds of millions of first time eCommerce buyers yet to transact, Snapdeal is well poised to grow in the future.” 

Snapdeal has raised close to $1.8 billion from multiple investors, including Softbank. At the peak, its valuation was close to $6.5 billion in 2016. The company was valued close to $1 billion during its merger talks with Flipkart in 2017 that fell through. The company’s current valuation is close to $200 million, according to industry experts.

A Snapdeal spokesperson, however, said that the valuation cited above was “way off the mark.” 

The company was recently in talks to acquire online marketplace ShopClues for an all-stock deal though the talks are said to have reached a standstill. Nexus Venture Partners is a common investor in both companies.

“Anand’s investment comes as a significant endorsement for Snapdeal and the transformation the company has undergone over the last couple of years,” Kunal Bahl, CEO of Snapdeal, said in the statement. “His appreciation for what it takes to build a company with growing revenues with good economics in a competitive market comes from his own experiences.”

The marketplace claims that 80% of its buyers come from tier-2 cities and beyond. The company has a base of five lakh sellers with over 200 million listings on the platform.