Walmart's Flipkart invests in Shadowfax as part of $60 mn funding round

A logistics firm, Shadowfax will use the funding to increase the number of shipments to 100 million a month and expand its geographical presence to 1,000 Indian cities

Walmart-owned e-commerce company Flipkart said it has made a strategic minority investment in Shadowfax, a cross-category and full-stack logistics platform founded in 2015. This investment is part of a $60-million Series D funding that Shadowfax has received from Eight Roads Ventures, Nokia Growth Partners, Qualcomm Ventures, Mirae Asset Naver Fund, and World Bank-backed IFC.

Flipkart has an existing partnership with Shadowfax to fulfill logistics requirements across various categories in its e-commerce business. As Flipkart focuses on building a sustainable hyperlocal ecosystem, it is working towards bringing offline Kirana stores into the fold of e-commerce by enabling them to be a part of this offering. The company’s hyperlocal approach aims at placing inventory closer to customers, leveraging the existing investments of space and working capital of Kirana stores to accelerate delivery timelines for consumers. Through this investment, Flipkart will be able to further unlock the opportunities in grocery and fresh produce, powered by Kirana stores and leveraging Shadowfax’s strong technology and fulfillment capabilities.

“At Flipkart, we are focused on redefining customer experience, and hyperlocal is a key element to enable this transformation. We have seen strong synergies with Shadowfax through our existing engagement with them, and their investments in tech-enabled innovations will help us significantly reduce delivery time and provide superior customer experiences across product categories,” said Kalyan Krishnamurthy, chief executive officer, Flipkart. “By leveraging Kirana stores and the deep delivery capabilities of Shadowfax and other Flipkart-led innovations, we are building a strong foundation to make inroads into a dynamic hyperlocal consumer market.”

Shadowfax enables the delivery of 10 million monthly shipments across diverse segments ranging from hot food, grocery to fashion and electronics. The company said it has seen a 6x growth in the last two years and the platform has more than 100,000 registered partners. The company will use the funds to enhance the tech capabilities of the platform, recruit talent, increase the number of shipments to 100 million a month and expand its geographical presence to 1,000 Indian cities.

“This strategic integration with Flipkart and its global best practices will not only unlock huge opportunities for Shadowfax; it will also enable us to innovate with the largest online platform in India and build core capabilities that can be democratized for the larger logistics ecosystem,” said Abhishek Bansal, chief executive officer, Shadowfax. “With our proprietary technology and best in class platform, we are committed to creating a million micro-entrepreneurs in the next five years.”

Flipkart owns a stake in many of the logistics firms such as online trucking platform BlackBuck and locker provider QikPod as it is scaling up its e-commerce business across the country, especially the tier-2 and tier-3 cities and small towns. Last month, Chinese e-commerce giant Alibaba announced an additional investment of $3.3 billion to increase its equity stake in Cainiao Smart Logistics Network Limited (Cainiao), which is dedicated to meeting Alibaba Group’s logistics vision of fulfilling consumer orders within 24 hours in China and within 72 hours anywhere else in the world.