SoftBank is in early discussions about investing in dairy products brand Country Delight as the Japanese tech investor is looking at diversifying its portfolio in India amid a slowdown in startup investments.
Country Delight is looking to raise around $50-70 million in a new funding round at a flat $800 million valuation, three people with direct knowledge of the matter told YourStory. SoftBank has initiated discussions to lead the round, the people said, requesting anonymity. Investment bank Avendus Capital will serve as the financial adviser for this round.
SoftBank, Country Delight, and Avendus Capital did not immediately respond to queries sent by YourStory.
If finalised, this deal would mark one of SoftBank’s first investments in a new Indian company since April 2022, when the Japanese investment giant paused its activity in the country due to challenging global economic conditions. SoftBank’s negotiations with Country Delight come on the heels of finalising a deal with the wearables and fitness brand Ultrahuman, where the Japanese investor is leading a $30 million funding round at a $300 million valuation.
“SoftBank has good vertical ecommerce startups in its portfolio that have done well and so the idea is to back more such companies,” one of the people quoted above said.
“The deal is in very early negotiations though and nothing has been finalised yet. The idea is to back proven models in the country and continue backing superstar companies in the portfolio and eventually to take them public,” the person added.
The deal also highlights SoftBank’s shift towards smaller deals in new companies while continuing to invest larger cheques in its existing portfolio companies. Besides Country Delight and Ultrahuman, SoftBank, in 2022, had first explored investment in GoMechanic, which fell through after the Japanese investor did due diligence and found irregularities in the company’s finances. Meanwhile, among its portfolio companies, SoftBank invested in Meesho’s $275 million funding round in May this year, which marked its first investment in two years.
Founded in 2015 by IIM Indore graduates Chakradhar Gade and Nitin Kaushal, Country Delight is a vertical ecommerce platform that delivers milk, fruits, vegetables, and other groceries in almost 17 cities, including Tier II towns including Vijayawada, Warangal, and Guntur, among others. The Delhi-based platform runs on a subscription model.
Last month, Country Delight raised Rs 200 crore in debt from Alteria Capital, and earlier this year, the company raised Rs 164 crore from Singapore’s Temasek at a $800 million valuation.
In FY23, Country Delight reported a revenue of almost $100 million (Rs 800 crore) and a net loss of Rs 249 crore. The company is yet to officially file its FY24 results, but according to The Arc, its revenue touched Rs 1,380 crore in the previous fiscal year. The report did not mention its loss figure.
Country Delight’s new funding round comes as the competition in the dairy manufacturing space is heating up. Earlier this year, Akshayakalpa, another dairy manufacturing brand, raised $12 million or Rs 100 crore led by A91 Partners.