Udaan Wraps Up $114 Million Funding Round Led by M&G and Lightspeed

Udaan’s funding round has drawn strong investor interest, closing at $114 million. The latest Udaan Series G funding was led by UK-based investment giant M&G and long-time backer Lightspeed Venture Partners, as per the Times of India. This fresh capital injection marks a major milestone for the B2B e-commerce platform as it strengthens its position in the Indian wholesale market.

The latest funding round was closed at the same valuation of $1.8 billion. This includes the earlier announced $75 million investment from the two lead investors, which Udaan’s CEO, Vaibhav Gupta, mentioned during a town hall earlier this year.

Back in 2023, Udaan raised $340 million from M&G Prudential at the same valuation. This was a drop from its highest valuation of $3.2 billion in 2021. Still, the company saw strong growth, with revenue increasing by over 60% in 2024.

Focus on Strengthening Core Business and Supply Chain

Udaan plans to use the newly raised funds to streamline its operations and improve its core offerings. The company’s main goal is to create a more efficient and tech-driven supply chain that benefits small retailers and shopkeepers across India. With an increasing number of small businesses going digital, Udaan aims to provide better accessibility to goods, lower prices, and faster delivery timelines.

Company executives noted that the funds will also help in reducing working capital cycles for retailers, improving margins, and bringing more transparency to business operations.

Big Push in FMCG and Staples Categories

A key area of focus for Udaan is the expansion in the FMCG sector. The platform is actively working on enhancing its reach in daily essentials and household products, which have seen growing demand from kirana stores and smaller retailers.

Along with FMCG, Udaan is also betting big on the staples market expansion. This includes core categories like rice, pulses, wheat, and other essential grains. By expanding its product base in staples, Udaan is positioning itself as a one-stop shop for small retailers looking for reliable sourcing options.

This expansion aligns with the company’s strategy to become a major player in the daily consumption segment, which offers high repeat usage and consistent demand.

Focus Remains on Sustainable Growth

The company stated that the recent Udaan’s funding round is part of its broader plan to build a sustainable business model. Udaan has been cutting down on losses and focusing on achieving positive unit economics. While the startup has not officially disclosed Udaan’s valuation after this round, sources suggest it remains in the range of $2.5 to $3 billion.

The company said in a statement, “This capital raise will also fortify Udaan’s balance sheet, providing enhanced financial flexibility as the company advances toward its public market debut.”

Looking Ahead

The startup is looking to automate more parts of its backend operations to cut costs and improve service levels. With this new capital, Udaan is expected to sharpen its focus on underserved retail markets and drive deeper penetration into Tier 2 and Tier 3 cities. The successful closure of Udaan’s Series G funding round sends a strong signal of investor confidence and positions Udaan well for its next phase of growth.

CEO, Vaibhav Gupta said, “We have reduced our Ebitda burn by 40% every year for the last three years and are on track to achieve full group Ebitda profitability in the next 18 months.”