Letsbuy.com Close To Raising Over $40M

By Shrija Agrawal

  • 14 Oct 2011

Delhi-based Etree Marketing Pvt Ltd, which operates the e-commerce site Letsbuy.com, is in advanced talks to raise over $40 million (Rs 195 crore) from a group of three investors including Sequoia Capital and Matrix Partners, multiple sources close to the development told VCCircle.

“The deal is expected to be concluded in another 20 days,” said one of the sources. This will be the second round of funding for the e-commerce company in less than nine months.

In January this year, the company raised $6 million in venture capital funding from Helion Venture Partners, Accel Partners and Tiger Global. In May 2010, the firm had received an undisclosed sum from angel investors.


Although the stake being acquired by the new investors stands undisclosed, assuming a typical deal of 20-30 per cent stake dilution, the e-commerce firm could be eyeing a valuation of up to $200 million or around Rs 980 crore.

When contacted, Hitesh Dhingra, co-founder and chief executive officer of Letsbuy.com, said, “We are in advanced stages to raise money but we can neither decline nor confirm the deal or the investors.”

Sequoia Capital also declined to comment on the deal.


Avnish Bajaj, managing director at Matrix Partners India, could not be reached on his cell phone while an e-mail query sent to the media relations desk did not elicit any response at the time of posting the article.

Letsbuy currently has sourcing hubs in Mumbai, Bangalore and Delhi, and now plans to come up with more of these hubs and 1,000-2,000 sq. ft. warehouses in other cities. The company’s advisory board includes Manish Vij, co-founder of Quasar Media, Tyroo, Zoomtra and Smile Technologies, and Nitin Gupta, who is currently mentoring the team at Letsbuy.com. Earlier, He was COO at Rediff.com and country manager (South Asia) for MasterCard.

Indian e-commerce space has been hotting up for the past one year and many of the e-commerce companies have raised money in the recent past. With moneybags back for funding, these Internet ventures and entrepreneurs are thinking big once more even as analysts are questioning whether a bubble is in the making.


Three months ago, group buying site Snapdeal.com had raised $40 million in its series B funding, led by Bessemer Venture Partners. Existing investors Nexus Venture Partners and Indo-US Venture Partners also participated in the round. Earlier too, Snapdeal’s fundraising charted a similar track when it announced a $12 million series A round in January from Nexus and Indo-US Venture Partners.

Incidentally, Snapdeal.com was reportedly valued at around $200 million.

As reported first by VCCircle, flipkart.com is eyeing a valuation of around $1 billion.


There are some fundamental reasons why e-commerce is set to take off in India, which explains why the surge is bigger and better than before.

According to experts, the next decade will bring massive growth in the Internet sector in India, supported by highly favourable demographics, growing Internet-broadband penetration, launch of 3G networks, growing middle class-income levels, noticeable pick-up in tech-gadget and mobile culture, and surge in home-grown Internet start-ups. Also, there is a thinking that about 20 per cent of retail sales will happen online in India as it is more cost-efficient and organised retail has not really taken off in the country.

While there are macro favourables in place, e-commerce, like most other businesses, boils down to execution play and creating a delightful experience for customers.


Also Read

Bessemer Leads $40M Round In Snapdeal

LetsBuy.com Raises $6M From Helion, Accel & Tiger Global

Flipkart Set To Raise $150M From General Atlantic At $1B Valuation


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