Fidelity Investments Slash Meesho's Valuation By 10% The valuation markdown for Meesho has come at a time when the Bengaluru-based startup is looking at reducing its cash burn
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US-based investor Fidelity Investments has cut the Bangalore-based e-commerce firm Meesho's valuation by about 10% to $4.4 billion, as per the recent regulatory filings with US SEC for the quarter ending March 2023.
According to the filing, in 2021, Fidelity had co-led Meesho's last fundraise — $570 million Series F funding round — valuing the company at $4.9 billion. The investment firm, which holds about 33,000 shares in Meesho through the Fidelity Central Investment Portfolio Fund, has since reduced the value of its stake by 9.6% from $2.59 million to $2.34 million.
"Funds attribute value to their portfolio investments, taking into account multiple factors. In this case, factors like an increase in the ESOP pool of nearly 4% in the applicable period have influenced the attribution of value," Meesho spokesperson reportedly said in a statement.
The decline in valuation is likely to be because of the overall slowdown in the global economy, the rising cost of living and so on. As per recent reports, Meesho has also laid off around 251 employees and in the last year, the company had let go off about 150 employees.
US-based multinational financial services firm had invested in Meesho in September 2021, which had resulted in Meesho's valuation doubling in less than six months. The valuation markdown for Meesho has come at a time when the Bengaluru-based startup is looking at reducing its cash burn and with this development Meesho has reportedly become eighth homegrown billion-dollar startup to suffer a valuation markdown.
According to an ET report, Vidit Aatrey, cofounder and chief executive of Meesho, had told that the company would continue to spend less on marketing, and it was ready to settle for a lower rate of growth
Earlier this week, edtech unicorn Eruditus and Byju's also saw their valuation cut. Swiggy, Pine Labs, PharmEasy and Ola are some others in the list.