Kinnevik cuts valuation for India's Quikr

Kinnevik, Europe’s largest listed technology investor, disclosed in its latest annual report that its 17% stake in Quikr is worth SEK941 million ($96 million), down from SEK1.7 billion a year earlier. This implies a valuation of SEK5.5 billion for the entire company.

Kinnevik invested $90 million in Quikr in 2014. The company has received $377 million in private funding to date, according to AVCJ Research. Backers include Matrix Partners India, Brand Capital, Steadview Capital, Tiger Global Management, Norwest Venture Partners, Omidyar Network, Warburg Pincus, and Nokia Growth Partners.  

In recent years, Quikr has made a number of acquisitions of start-ups offering complementary services such as Zimber, Commonfloor, Hiree, AtHomeDiva, and Dazzlr. Kinnevik cited concerns related to the discovery of fraudulent activities by employees managing the co-living and cars sales businesses. According to a blog post, the company said its employees had colluded to “game the system”. 

“Quikr has discovered that certain dealers and vendors within the managed rentals and cars segments have placed fictitious or misrepresented transactions on its platform. Quikr has accordingly sought to manage its headcount and cost base to reflect the streamlined business,” Kinnevik said.

The investor added that it was also changing the way it valued Quikr by comparing performance to publicly listed peer companies in emerging markets. Previously, it used a discounted cash flow analysis metric but the fraudulent transactions have likely overstated revenue for the current year.

Quikr primarily makes money from commissions on transactions related to ad listings for blue-collar jobs, used goods and real estate. For the first six months of the latest financial year, it generated earned $65 million in revenue.

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• Topics
• South Asia
• Technology
• India
• Matrix Partners
• TMT