TOKYO -- Indian food delivery company Swiggy has raised $1.25 billion from investors including SoftBank Group's Vision Fund 2, as the startup aims to expand its business and capture India's growing online grocery market.
The company said on Tuesday that the latest fundraiser "was heavily oversubscribed following strong interest from investors, and comes on the back of Swiggy's rapid recovery from the impacts of COVID-19 and subsequent growth in 2020-21."
Swiggy was founded in 2014. Its food delivery platform, which connects users to over 150,000 restaurant partners and stores in over 500 cities, has experienced rising demand following the coronavirus outbreak.
In addition to operating its instant grocery delivery service Instamart, the company has been expanding its new pickup and drop service called Swiggy Genie, which lets users deliver or receive anything from food to laundry.
The latest funding was led by SoftBank's Vision Fund 2 -- its first investment in Swiggy -- as well as investment group Prosus. Other contributors include Accel Partners, Wellington Management and Qatar Investment Authority.
Swiggy plans to put the fresh funds toward expanding its core food delivery business, as well as other new services. The startup said that the funds will support efforts to enhance its technological capabilities, including artificial intelligence.
"The scope of food delivery in India is massive and over the next few years, we will continue to invest aggressively into growing this category," CEO Sriharsha Majety said in a statement. "Our biggest investments will be in our non-food businesses that have witnessed tremendous consumer love and growth in a short span, especially in the past 15 months of the pandemic."
Munish Varma, managing partner at SoftBank Investment Advisers, which manages the Vision Fund, also said: "SoftBank has successfully backed multiple food delivery platforms globally and seen the value of providing high-quality convenience to consumers."
"Swiggy's focus on evolving the consumer experience, and its emphasis on relationships with its delivery partners and restaurants, have made it a household brand in India," Varma added.
India's online food delivery market is led by Swiggy and Zomato, while some expect competition to heat up with Amazon India announcing its entry last year.
Rival Zomato, which is backed by Uber and Ant Group, is approaching its initial public offering next week in which the company plans to raise $1.25 billion.