eBay has inked a partnership with Indian ecommerce outfit Snapdeal that will see it lead a US$50-million investment in the three-year-old online retailer.
According to the Wall Street Journal, the funding round values Snapdeal at US$250-million and is believed to include participation from the likes of Intel Corp.’s Intel Capital, Nexus Venture Partners and other companies.
“The partnership seeks to drive more consumer demand for eBay and Snapdeal merchants along with wider selection for India consumers in a rapidly growing market,” eBay said in a statement.
Like fellow US-based ecommerce giant Amazon, eBay apparently sees massive potential in India’s burgeoning ecommerce market. In early 2012, Amazon made its Indian ecommerce play with the launch of Junglee — an online shopping aggregator. Quoting the Internet & Mobile Association of India research, eBay reckons that the Indian ecommerce market will grow from approximately US$1.2-billion in 2012 to US$ 1.8-billion in 2013.
It’s not, however, always easy making the most of that kind of growth. Companies trying to enter the country are frequently curtailed by strict laws are designed to “restrict foreign companies on multi-brand retail”.
“The growth of online shopping in India is at an exciting phase. We chose to partner with Snapdeal due to their complementary business model, good management team and strong brand,” eBay Asia-Pacific Senior Vice President and Managing Director Jay Lee said.
According to India’s Economic Times Snapdeal employs over 1 500 people and delivers to more than 5,000 cities and towns in India.