You need deep pockets to take on the likes of Amazon, Reliance and Flipkart in India’s consumer internet space. Tata Sons, which has deeper pockets than most, is nonetheless looking to raise up to $2.5 billion from global investors to fund its e-commerce expansion ahead of the pilot of its ‘super app’ in September.
We at ETtech have been right on top of all the big moves being made by the Tata group as it pushes hard to prove its digital relevance.
Today my colleague Kala and I report on how Tata Digital is going into fundraising mode with its new, big hire Mukesh Bansal in tow.
We broke the big story on May 27 about Tata eyeing Curefit and more importantly Bansal for a plum, leadership role at Tata Digital. Now we’ll tell you what the plan is for Tata as it takes on tech giants such as Amazon and Walmart-backed Flipkart, not to mention the Reliance juggernaut.
Fundraising phase: Getting outside capital is now at centre stage for Tata Digital, after having announced a bunch of investments in the past few weeks ranging from BigBasket to 1mg to Curefit. We’ve been told Tata is in talks to mop up $2 billion or more to kick off the big project started by Tata Sons chairman N Chandrasekaran a few years ago. This $2-2.5 billion sum could become much larger depending on how the first installment closes. All of this comes on the back of its much-delayed super app launch, which we now know will come through by September.
What’s Mukesh Bansal’s role in this? The Tata group has brought in Bansal to not only gain from his fundraising prowess but also be able to hire top tech talent. Having built fashion e-commerce biggie Myntra, along with his stint at Flipkart and now Curefit, Bansal is among the most seasoned internet entrepreneurs in the country. Having set up teams across two well funded startups and also at Flipkart, he will be able to attract professionals who may not want to work with a legacy group but would be willing to work with him, betting on his background.
This is where Tata’s digital strategy is widely different from how Mukesh Ambani has gone about making acquisitions and investments in new-age startups. After Reliance Jio Platforms raised $15.2 billion last year, it didn’t really go on to plough that money into big digital assets that would help it snag top-notch founders. Instead, it only acquired companies that were in dire straits and thus inexpensive — think Urban Ladder, Milkbasket.
But things won’t be easy: While Tata has made a good call by bringing in the likes Bansal, BigBasket’s founder Hari Menon and 1mg’s Prashant Tandon to help its digital business, what will be interesting to see is how these new-age entrepreneurs blend with the group’s old guard. People problems aside, how will the super app integrate offline businesses like Westside and Croma with the online platform? Will the loyalty programme work in a massive group with so many different businesses? Much of this will unfold over the next few months.
https://economictimes.indiatimes.com/tech/technology/tatas-plan-to-raise-2-2-5-billion-for-e-commerce/articleshow/83730978.cms
