E-commerce firm Snapdeal said on Tuesday it has picked up minority stake in hyper-local grocery delivery service, PepperTap, leading a $36 million funding round.
The funding will be used to expand PepperTap's presence to 75 cities from the current 18 cities, customer and talent acquisition, PepperTap Co-Founder and CEO Navneet Singh said.
PepperTap, which is looking to raise up to $20 million more in 2-3 weeks, said the current round of funding saw participation from existing investors-Sequoia India and SAIF Partners-as well as new investors such as Ru-net, JAFCO, and BeeNext.
"We have worked with Navneet and his team that also runs a logistics firm (Nuvo Logistics). Grocery is about 59 per cent of retail GDP in India and we are excited to be entering into a strategic partnership with PepperTap to tap this market," Snapdeal CEO Kunal Bahl said.
Snapdeal has been on an acquisition spree, beefing up its presence as it takes on players such as Flipkart and Amazon in the burgeoning Indian e-commerce industry.
This year alone, Snapdeal has acquired payments and mobile recharge startup Freecharge in a cash-and-stock deal (estimated at $400-450 million), MartMobi, Letsgomo Labs and Reduce Data.
It has also picked up stakes in digital financial services platform RupeePower and logistics venture GoJavas.
Founded in 2010, Snapdeal has over 90 million registered users (Freecharge included) and over two lakh business sellers. Snapdeal, which counts Japan's SoftBank, Foxconn, Alibaba and eBay among its investors, has been scouting for acquisitions in mobile technology and supply chain space.
"We will work towards accelerating growth at PepperTap. Grocery is going to be a big driver for online retail in India and we want to play a leading role in building a conducive ecosystem for further growth of e-commerce in the country," Bahl added.
PepperTap allows customers to choose from over 15,000 products across categories like daily use items, bath and hygiene products, fruits and vegetables, etc.
It generates about 20,000 average transactions per day.
PepperTap raised seed round of $1.2 million from Sequoia India in November 2014 and Series A of $10 million from SAIF Partners and Sequoia India.
"From less than $1 million GMV run rate at the start of fiscal 2015-16, we are solidly on track to end the year with a GMV run-rate of over $250 million. Using the investments, we are looking at expanding our footprint to 75 cities in the next six months. We will also double our head-count from the current 3,000 in the same time frame," Singh said.
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