Dunzo may see valuation drop to $200 million in $35 million rights issue

economictimes.indiatimes.com:

Dunzo is seeking a final nod from its board to raise up to $35 million through a rights issue even as some of its investors are of the view that the valuation of the beleaguered startup be slashed to about $200 million — or one fourth of its peak value of $800 million – for the critical financing round, several people aware of the matter said.
While a few of the existing investors have committed around $10-15 million in capital at the reduced valuation, the company’s board is yet to clear the proposal, they added. Further, a meeting scheduled for last week is now expected to take place later this week. Company founder and CEO Kabeer Biswas is expected to seek clearance from the board, including top shareholders like Reliance Retail, Google and others, in the coming days to close the much needed funding, the sources said.

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“The current commitment is at around a $200 million valuation. That’s also the blended average for most investors in the firm before it was valued at close to $800 million,” according to one investor privy to the discussions.

“This money is also committed to the fact that it (Dunzo) will become a B2B company for all practical purposes doing delivery for business customers,” the person said, while adding that “everyone putting in the capital needs to agree on the new valuation.”


The crisis-ridden startup firm has drastically reduced the scale of its