Dealshare Raises $144M to Expand Social Commerce in India & Beyond

Investment Surge in Indian Social Commerce: DealShare Secures $144 Million

Significant investment is being channeled into the exploration of social commerce’s potential within the Indian market. DealShare announced on Thursday a successful fundraising round of $144 million, intended to bolster its presence throughout South Asia and investigate possibilities for international expansion.

Series D Funding and Valuation

This latest financing round, designated as Series D, was spearheaded by Tiger Global. It has resulted in a post-money valuation of $455 million for the Indian startup, a substantial increase from the $50 million pre-money valuation achieved during its Series C funding. Reports surfaced in April, as covered by TechCrunch, indicating that the New York-based hedge fund was in discussions to lead a significant investment in the Bangalore-based company.

WestBridge Capital, Alpha Wave Incubation, Z3Partners, Partners of DST Global, and Alteria Capital also contributed to this new round. This marks the third funding event in the past seven months, bringing the total capital raised by the startup to $183 million.

Addressing an Underserved Market

While established players like Amazon and Flipkart have successfully cultivated a considerable market share in urban India, a large portion of the country remains relatively unserved by e-commerce solutions. Interestingly, DealShare commenced operations on the very day Walmart completed its acquisition of Flipkart.

Initially launched as an e-commerce platform integrated with WhatsApp, DealShare provides consumers with access to a wide array of products. The company focuses on reaching customers in smaller Indian cities and towns.

The Group Buying Model and Affordability

DealShare’s strategy centers around enabling customers to purchase curated items collectively, fostering a “highly competitive” affordability. The startup reports an average cart value ranging from $16 to $19 per transaction.

Positioned as a competitor to Meesho, backed by SoftBank and Prosus Ventures, DealShare aims to deliver “high-quality, low-priced essentials” alongside a shopping experience that is gamified, engaging, and utilizes local languages to appeal to first-time internet users.

Community Purchasing and Economic Efficiency

The implementation of community purchasing facilitates an “ultra-low-cost delivery mechanism” and ensures “best-in-class unit economics.” DealShare has cultivated a network of over 1000 microentrepreneur partners who actively promote the community group buying model across the nation.

“Our plans include strengthening this network to exceed 5,000 partners by the end of the year,” stated Sankar Bora, founder and chief operation officer of DealShare. “Furthermore, we intend to accelerate growth through investments in cutting-edge technology and infrastructure, ensuring operational efficiency.”

Tiger Global’s Perspective

Griffin Schroeder, partner at Tiger Global, expressed enthusiasm regarding the partnership, stating, “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.”

Future Expansion and Profitability

DealShare anticipates achieving profitability within the next 12 months and is also planning expansion into international markets, beginning with the UAE, as indicated by Navroz Udwadia, co-founder and chief executive of Falcon Edge Capital.

The Potential of Social Commerce in India

Analysts at Jefferies recently noted that social commerce, integrating commerce with social media platforms, is still in its early stages in India but possesses significant potential for widespread adoption.

“The entry of major players like Reliance and Tata Group is already impacting the e-commerce landscape, and social commerce could further accelerate its growth. Comparisons to China suggest substantial opportunities. Meesho, a pioneer in this space in India, has already reached a Gross Merchandise Value (GMV) of $1.4 billion (as of March 2021),” they added.