Constancy cuts Meta-backed Meesho valuation to $3.5 billion

Constancy has minimize the worth of its holding in Meesho by 33.6% because the 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 concerning 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 12 months when early backer Enterprise Freeway bought a few of its fairness in Meesho to WestBridge Capital, Information World first reported. That sale valued Meesho at $3.5 billion, an element which will have contributed to Constancy’s evaluation.

In an announcement to Information World, a Meesho spokesperson mentioned: “Funds attribute worth to their portfolio investments, contemplating numerous elements such because the valuation of comparable firms. Primarily based 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, might 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, in response to the month-to-month disclosure. All of those startups stay far under 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 under cities, permitting it to successfully goal a demographic largely ignored by Flipkart and Amazon to this point. Meesho’s strategic prioritization of small cities and give attention to mass-market, value-conscious buyer base is paying dividends, in response to AllianceBernstein.