Arzooo, which helps physical retailers compete against e-commerce platforms, has raised $6 million (about Rs 43.3 crore) from venture debt firm Trifecta Capital.
The development comes just days after VCCircle reported that the company was in discussions with at least two venture debt firms to raise capital.
It also comes only around four months after Bengaluru-based Arzooo raised $7.5 million (about Rs 54.2 crore) in a Series A funding round that was led by US-based technology venture fund WRVI Capital.
Other participants in that round included 3Lines Venture Capital, UAE-based Jabbar Internet and another undisclosed US-based investor. Later in 2020, it also raised an undisclosed sum from Zoom Video Communications founder Eric Yuan.
In a statement, Arzooo said it will use the capital secured from Trifecta to enhance its supply chain infrastructure as well as for market expansion and scaling its operational capabilities.
The company currently has a presence in South, North and East India, and will now expand to Maharashtra and Gujarat. It is aiming to hit a $500 million (about Rs 3,614 crore) sales run rate during this year.
Arzooo, operated by Sterne India Pvt. Ltd, was set up in 2018 by former Flipkart executives Khushnud Khan and Rishi Raj Rathore. Its platform helps physical retailers grow and compete by helping them improve margins, stock-keeping and delivery. The startup says it currently has a network of over 7,000 stores across more than 10 cities.
“Neighbourhood stores are a fantastic channel to drive digitization, inventory expansion and price competitiveness over online retailers. Arzooo has seen a strong demand recovery post the covid-19 lockdown,” said Rahul Khanna, managing partner, Trifecta Capital.
Trifecta Capital, which will hit the road later this year to raise a third fund, has backed firms such as online grocer BigBasket and PharmEasy. Across its two funds, the venture debt firm has invested close to Rs 1,700 crore (about $235 million) in growth-stage companies.
Recently, it invested in merchant-focused financial services company BharatPe.
Founded in 2015 by managing partners Rahul Khanna and Nilesh Kothari, Trifecta Capital invests in early growth-stage companies that have raised Series B equity capital and beyond. In January, TechCircle reported that the firm was set to witness the departures of two senior personnel.