Some of the biggest names in global e-commerce have made a major bet on the continued rise of online shopping in India. Microsoft, eBay and Tencent collectively have made investments totaling nearly $1.5 billion in India’s leading online marketplace, Flipkart. eBay’s investment comes in the form of selling its Indian business to Flipkart in exchange for an equity stake, along with a lump sum of $500 million. Tencent, a Chinese competitor to Alibaba, characterized its investment as strategic, but did not elaborate on how much capital it is providing Flipkart. The most recent investment—Flipkart’s largest at one time—brings its total valuation to $11.6 billion.
“We are delighted that Tencent, eBay and Microsoft—all innovation powerhouses—have chosen to partner with us on their India journey,” Flipkart’s founders, Sachin and Binny Bansal, said in a statement. “We have chosen these partners based on their long histories of pioneering industries, and the unique expertise and insights each of them bring to Flipkart. This deal reaffirms our resolve to hasten the transformation of commerce in India through technology.”
The potential of India as an e-commerce behemoth has been touted since the introduction of mobile devices made delivering Internet services to its population of 1.3 billion a realistic possibility. According to a recent report, the country will surpass the U.S. as the world’s second-largest e-commerce market in a little more than 15 years.
Cross-Border E-Commerce in Emerging Markets