This fresh round of debt funding follows a tough period of restructuring and consolidation, which led to over 1,000 jobs being cut at the company in the 2022-2023 period.
Last December, the JioMart rival had cut 10% of its workforce days after raising a $340 million funding round and said that it was “fully funded and positioned to be IPO-ready in the next 12-18 months.”
The fresh capital infusion in the form of debt will help udaan strengthen its balance sheet and achieve profitability-on-priority by investing in initiatives that accelerate sustainable growth, the company said in a statement.
With fresh capital infusion, udaan plans on scaling its geographical footprint through a ‘micro-market strategy’, streamlining supply chain processes and investing in opening new micro-fulfilment centres (MFCs).
The company in its statement further said, “These market-driven initiatives will significantly enhance operational efficiency across all verticals while driving productivity and reducing costs.”
In the CY24 year-to-date (YTD) period, the company claims to have achieved a 30% reduction in absolute EBITDA burn, with a 60% revenue growth.
In FY23, Udaan’s revenue from operations slipped by 43% from Rs 9,897.3 crore in FY22 to ₹5,609.3 crore in FY23, as per an Entrackr report. Over the same period, losses were cut to ₹2,213.0 crore in FY23 from ₹3,075.8 crore in FY22.
Founded in 2016 by Sujeet Kumar, Amod Malviya, and Vibhav Gupta, Udaan helps mom-and-pop shops source FMCG, staples, fruits and vegetables and more, by ordering through a B2B e-commerce platform.
Backed by the likes of Lightspeed Ventures, DST Global and Tencent, the company turned unicorn in 2018 and hit a peak valuation of $3.2 billion in 2021. The valuation has reportedly slumped to $1.8 billion in recent rounds.