Udaan raises $114 million in flat round at $1.8 billion valuation

BENGALURU: B2B ecommerce platform Udaan has raised $114 million in fresh equity capital as part of its Series G funding round, led by M&G Investments and Lightspeed. The round also saw participation from existing and new investors. The Bengaluru-based company said the funds will be used to deepen its category presence, particularly in FMCG and staples, and expand further into underserved markets.

Udaan has secured the latest funding at a valuation of about $1.8 billion, people familiar with the matter told TOI. This makes the funding a flat round, which is when a company's valuation remains the same or nearly the same as the previous funding round. The company had previously raised $340 million in 2023, led by UK-based M&G Prudential, at the same valuation, marking a notable decline from its peak valuation of $3.2 billion in 2021.

Founded by former Flipkart executives Vaibhav Gupta, Amod Malviya, and Sujeet Kumar, Udaan has been restructuring its operations since 2022, focusing on profitability amid a more cautious funding environment. The company has reduced its operating scale to manage costs and streamline business priorities. Malviya and Kumar no longer oversee day-to-day operations, with Gupta currently serving as CEO.

The latest financing, Udaan said, strengthens its balance sheet as it moves closer to a potential public market listing. This round follows a broader restructuring of the business over the last three years, with the company claiming a 40% annual reduction in Ebitda burn over the same period.

Founded in 2016, Udaan operates across verticals including fast-moving consumer goods, pharma, staples, and fresh produce, and claims to hold around 70% of India’s eB2B market share. The company said it is pursuing a cluster-led operating model to drive “profitable growth at scale,” with emphasis on technology-led distribution and private label expansion in staples.

The company said it posted over 60% year-on-year revenue growth in calendar year 2024. Contribution margins improved by more than 300 basis points during the year, with an additional 100 basis point gain reported year-to-date in 2025. Fixed costs, the company said, were cut by 20% last year, contributing to overall margin improvements.

“This funding marks a key milestone as we continue our journey towards public markets,” said Vaibhav Gupta, co-founder and CEO of Udaan. “Our hybrid model combining a digital platform with tech-led sales is proving effective, and we are on track to achieve group-level Ebitda profitability within the next 18 months.”

The fresh capital will also be deployed to enhance Udaan’s technology stack, including customer engagement tools and sales-tech capabilities. The company currently serves a large network of small businesses, retailers, and suppliers across India, and also offers working capital solutions through its financial services arm, UdaanCapital.