Constancy cuts Meta-backed Meesho valuation to $3.5 billion

Constancy has minimize the worth of its holding in Meesho by 33.6% for the reason that unique 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 by 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 previous funding. The valuation adjustment follows a secondary sale transaction late final yr when early backer Enterprise Freeway sold some of its equity in Meesho to WestBridge Capital, TechCrunch first reported. That sale valued Meesho at $3.5 billion, an element that will have contributed to Constancy’s evaluation.

In a press release to TechCrunch, a Meesho spokesperson stated: “Funds attribute value to their portfolio investments, considering various factors such as the valuation of comparable companies. Based on Fidelity filings, the number of shares held and the current number of total outstanding fully diluted shares, the valuation is assessed at $3.5 billion. The increase in the number of outstanding shares, notably due to the ESOP pool expansion, could have contributed to this valuation shift.”

On the identical time, Constancy has barely marked up the worth of its holding in Reddit, Gupshup and X, based on the month-to-month disclosure. All of those startups stay far under their unique 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 current GMV run rate is over $5 billion, AllianceBernstein reported earlier this month. It’s additionally seeking to broaden into new areas — planning to construct a monetary companies platform and scale its grocery supply enterprise, Indian day by day Financial Instances reported Tuesday.

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