1mg receives $40 million in investment from Tata Digital, joining the unicorn club
The premium was more than 5 times what 1mg had raised previously, when the business was valued at $240 million. Tata 1mg is valued between $1.25 and $1.30 billion in the most recent round.
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The coveted unicorn club has been entered by the Tata-owned online healthtech platform 1mg thanks to new fundraising of roughly $40 million in a round headed by Tata Digital, which valued the business between $1.25 and $1.30 billion.
Startups with a valuation of $1 billion or more are considered unicorns.
According to a filing with the ministry of corporate affairs, the board of Tata 1mg approved a special resolution to award 30,992 equity shares with a face value of Re 1 each at a premium of Rs 1,03,046, the firm said (MCA). Thus, the company raised around $40 million, or about Rs 319.36 crore.
According to a Moneycontrol estimate, the premium was more than 5 times the amount of 1mg's prior financing, which valued the business at $240 million. Tata 1mg was valued between $1.25 and $1.30 billion at the most recent round.
According to the MCA documents, Tata Digital took the lead in the round with a close to Rs 254 crore ($32 million) investment, followed by KWE Beteiligungen AG, HBM Healthcare Investments, MAF Mauritius, MPOF Mauritius, and individual investors Rubal Jain and Vardaan Sharma.
The current round of funding for Tata 1mg comes at a time when healthtech firms have struggled due to a waning coronavirus epidemic, which has caused a decline in demand for online services as regulations have been relaxed.
Nearly 400 people were let go by the healthtech company Mfine in May before it merged with LifeCell International's diagnostics division, based in Chennai, to concentrate on more lucrative sectors. Mfine is backed by international venture capital firms like Beenext and Prime Venture Partners.
Pharmeasy, a healthtech platform sponsored by Tiger Global, withdrew its initial public offering draught papers in August, blaming market conditions. According to reports, the company is currently attempting to raise money at a reduced valuation.
In order to create an independent online pharmacy company, Tata 1mg, formerly known as 1mg, was split off from health technology platform Healthkart in 2015. The online pharmacy vertical inside Healthkart was known as HealthkartPlus. A number of investors contributed $6 million to the company when it was spun out as 1mg under 1mg Technologies.
According to media sources, Tata Digital spent more over Rs 700 crore to purchase a 63 percent share in the firm, which was rebranded as Tata 1mg, after it was acquired by Tata in 2021.
In FY21 (2020-21), the first year of the pandemic, the company recorded revenue of Rs 316 crore, down from Rs 369 crore in FY20 (2019-20). According to the company's regulatory filings, its losses have stayed virtually same at Rs 314 crore in FY21 compared to Rs 318 crore in FY20.
