TPG NewQuest, the secondaries-focused arm of private equity firm TPG, has led a $100-million (about Rs 830 crore) round of investment in logistics and delivery startup Shadowfax.
The Series E funding round also saw participation from existing investors, including Mirae Asset Venture Investments (India), Flipkart, International Finance Corporation, Nokia Growth Partners, Qualcomm and Trifecta Capital.
VCCircle had reported about TPG NewQuest’s investment in Shadowfax in October last year.
The latest funding round consists of a blend of primary, secondary and venture debt financing. As far as secondaries are concerned, the company’s first institutional investor Eight Roads Ventures has made a partial exit. The VC firm had invested in its Series A round in 2015.
Shadowfax said that it will use the fund to reinforce its middle-mile network and extend its last-mile delivery services to cover all 20,000 pin codes across India over the next 18 months.
It will also use the fresh capital to develop services for direct-to-consumer (D2C) brands leveraging cutting-edge technologies and further improving its express delivery network, the company said in a release.
"Our ability to capture a greater share of the market, even in a tough economic climate, is a testament to the core strength of our business,” said Abhishek Bansal, chief executive officer (CEO) of Shadowfax.
Set up in 2015 by Bansal, Vaibhav Khandelwal, Gaurav Jaithliya, and Praharsh Chandra, Shadowfax provides logistics services to digital-first consumer companies and e-commerce platforms such as Decathlon and Myntra. Additionally, it offers 30-minute delivery services to quick commerce, pharmacy, and food delivery platforms like Swiggy, Zomato, Apollo Pharmacy, Blinkit, and BigBasket.
Shadowfax’s revenue for the fiscal year ended March 2023 grew 42.8% to Rs 1,415 crore, from Rs 991 crore in the preceding year. Moreover, the company's loss at EBITDA level narrowed to Rs 85 crore during the year from Rs 127 crore in FY22.
EBITDA margin remained in negative but improved to -6% in FY23 from -13% in the previous year.
Shadowfax is targeting a 50% growth in revenue to Rs 2,100 crore for FY24, Bansal had told VCCircle in an earlier interaction.
"Shadowfax is our first investment in India and we have participated in each subsequent round which is a testament to the strong performance that the company has delivered over successive quarters for the last 5 years,” said Ashish Dave, CEO of Mirae Asset Venture Investments (India). “We believe that logistics is fundamental to ecommerce and hyperlocal commerce and that it enables the growth of these markets.”