Indian Ecommerce Industry
India’s Ecommerce Industry is filled with many top firms like snapdeal
etc.. Over the past four years, the consumer internet space has had its share of acquisitions, mergers, and shutdowns.
Flipkart’s Letsbuy acquisition was probably the first major consolidation, soon to be followed by the likes of Fashionandyou-Urbantouch, Flipkart-Myntra, Snapdeal-FreeCharge, and of course, Myntra (Flipkart)-Jabong now.
While consolidation is a natural part of the evolution of any industry, it also sends out certain signals to those not directly involved. Thus, most of the acquisitions in the e-commerce space have largely been because of the inability of companies to raise additional capital and weed out competition or because they have been forced by common investors. Tiger Global, a common investor in Letsbuy and Flipkart, is said to have forced the former to merge with the latter while Ola bid for TaxiForSure as the SoftBank-backed company didn’t want TFS to lock lips with hyper-funded Uber.
According to YourStory
Research, venture capital-backed companies in India have raised $2.1 billion for the first half of 2016, a 40-percent drop from the same period in 2015, when startups raised $3.5 billion across 380 deals. These volumes are not going to improve anytime soon, as two of the biggest believers — Tiger Global and SoftBank — allow their Indian investments to show some more promise before committing afresh.
On the aforementioned analogies, several Indian e-commerce companies are also slated to get transferred to deep pocketed players. YourStory had earlier written about chances of possible synergies between Flipkart- Paytm, Snapdeal-Paytm as they aim to compete with Jeff Bezos-led Amazon’s increasing dominance and popularity amongst online shoppers.