SoftBank Vision Fund invests $2.5bn in Flipkart to leverage technology in India
The Amazon vs Flipkart saga has stepped up a notch as SoftBank Vision Fund announced record investments into India's e-commerce giant Flipkart, in a bid to support innovation and leverage technology.
SoftBank Vision Fund invests $2.5bn in Flipkart to leverage technology in India
The investments, which are worth $2.5bn, will aid Flipkart's battle against Amazon. The investment is part of the previous announcement by SoftBank to capture 20% stake in both Flipkart and Paytm in India.
The move is interesting because in 2011, Flipkart wanted to rope in SoftBank as an investor, which would have cost Masayoshi Son, founder and chairman & CEO of SoftBank Group Corp, a few hundred million, rather than billions, for a similar stake.
However, things didn't turn work out and Flipkart raised a funding round, led by South African media giant Naspers, in 2012 that valued it at $1bn.
“India is a land of vast opportunity. We want to support innovative companies that are clear winners in India because they are best positioned to leverage technology and help people lead better lives. As the pioneers in Indian e-commerce, Flipkart is doing that every day,” said Son.
Co-founders of Flipkart, Binny Bansal and Sachin Bansal said, “This is a monumental deal for Flipkart and India. Very few economies globally attract such overwhelming interest from top-tier investors. It is recognition of India’s unparalleled potential to become a leader in technology and e-commerce on a massive scale.
"SoftBank’s proven track record of partnering with transformative technology leaders has earned it the reputation of being a visionary investor. We’re excited to welcome the Vision Fund as a long-term partner as we continue to build our business with a focus on serving the needs of all Indians, and driving the next phase of technology adoption in India," they added.
Flipkart recently completed a merger with eBay.