In order to fund capex requirements, online grocery retailer BigBasket has raised Rs 45 crore as venture debt from Trifecta Capital. These funds will be utilised to set up new warehouses and strengthening the cold chain.
Commenting on the development, BigBasket’s Hari Menon said: “We have a clearly identified use case for debt. We are present in 25 cities and continue to optimise our supply chain. A significant part of our business is fresh fruits and vegetables, the bulk of which is sourced directly from farms. It is crucial that we maintain the quality right up to the last mile.”
We are in the last leg of a pilot which will ensure that all fruits and vegetables are maintained at constant temperature and thereby improving the shelf life of the produce by almost 10 days. Funding such capex requirements is best done through debt,” he added.
The move comes at a time when Amazon has launched Amazon Now in the country – a service under which people can buy products of daily use from local outlets and get it delivered in just 2 hours.
Not seeing any major threats from Amazon’s entry in the segment, Menon in a recent interview to Moneycontrol said, “Indian grocery segment (both offline and offline) is a very large market of about USD 400 billion. Markets of this size have enough space for more players. In fact, in markets of this size, consumers open up to new formats much faster when there are more players. Our strategy is simple – focus on execution, innovate with the customer in mind and ensure our customers are the focus.”
Endorsed by actor Shah Rukh Khan, the company has raised USD 246.75 million in funding so far.
Nilesh Kothari of Trifecta Capital in a statement said, “BigBasket is the largest online grocery store in the country and has built a credible name across millions of households. Unlike other online grocery businesses, they are a full stack player and have already broken even in some of the key markets like Bengaluru and Hyderabad. We are excited to be part of their growth story.”
Trifecta Venture Debt Fund is the country’s largest fund of its kind with a target corpus of Rs 500 crore. In 18 months since commencement of operations, the fund has supported 18 companies like PaperBoat, Rivigo, Nephroplus, Urban Ladder, Industrybuying, OneAssist, Urban Clap and IdeaForge etc. RBL Bank and AzimPremji Trust are the Anchor Investors in the Fund.