Constancy cuts Meta-backed Meesho valuation to $3.5 billion

Constancy has lower the worth of its holding in Meesho by 33.6% for the reason that authentic funding, giving the Indian social commerce startup a valuation of $3.5 billion, adjusted for excellent shares.

The U.S. asset supervisor valued its holding in Meesho at $27.8 million at December’s finish, down from the $41.9 million that it invested within the second half of 2022 via a selected mutual fund unit. Constancy made the disclosure in regards to the markdown in its month-to-month disclosure on Monday afternoon.

Constancy had marked down the valuation of Meesho to $4.1 billion on the finish of October. The startup was valued at $4.9 billion in its earlier funding. The valuation adjustment follows a secondary sale transaction late final yr when early backer Enterprise Freeway bought a few of its fairness in Meesho to WestBridge Capital, TechCrunch first reported. That sale valued Meesho at $3.5 billion.

In an announcement to TechCrunch, a Meesho spokesperson stated: “Funds attribute worth to their portfolio investments, contemplating varied components such because the valuation of comparable firms. Based mostly on Constancy filings, the variety of shares held and the present variety of complete excellent totally diluted shares, the valuation is assessed at $3.5 billion. The rise within the variety of excellent shares, notably because of the ESOP pool growth, may have contributed to this valuation shift.”

On the similar time, Constancy has barely marked up the worth of its holding in Reddit, Gupshup and X, in keeping with the month-to-month disclosure. All of those startups stay far beneath their authentic funding {dollars}.

Meesho — which counts Meta, Peak XV, Prosus Ventures, B Capital, and SoftBank amongst its backers — operates a social commerce startup and is among the many quickest rising e-commerce startups within the nation. Its present GMV run fee is over $5 billion, AllianceBernstein reported earlier this month. It’s additionally seeking to increase into new areas — planning to construct a monetary providers platform and scale its grocery supply enterprise, Indian each day Financial Occasions reported Tuesday.

Over 50% of Meesho’s gross sales come from Tier 2 and beneath cities, permitting it to successfully goal a demographic largely neglected by Flipkart and Amazon to date. Meesho’s strategic prioritization of small cities and deal with mass-market, value-conscious buyer base is paying dividends, in keeping with AllianceBernstein.

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