India's Zetwerk secures $120m Series D

Sequoia Capital India and Kae Capital also participated. If follows a $21 million Series C led by Greenoaks last year that featured Lightspeed, Sequoia India, Kae, and Accel Partners. InnoVen Capital India provided about $2.2 million earlier the same year. The start-up has raised $193 million since its inception in 2018.

Zetwerk describes itself as a universal platform for the entire manufacturing ecosystem. Its core service is to connect small-scale manufacturing service providers with customers and support project management activities via what Sequoia India has called "a new category of marketplace."

Target industrial areas include processing plants, energy, steel, aerospace, automotive, consumer electronics, medical devices, apparel, and luxury goods. Consumer goods represented about 15% of revenue in the first six months of operation.

Zetwerk's network includes about 250 customers and 2,000 suppliers in about 15 countries. An international footprint was not established until last year, with the expansion attributed to an increasing desire among global companies to make their supply chains more resilient by diversifying into India and Southeast Asia.

The company claims to have grown threefold during 2020. More than 1,000 unique projects have been executed and delivered to date, and about 2,000 are said to be currently in progress. The fresh capital will support technology development and further expansion into new categories and regions,

"We were amazed by the customer-centricity and antifragility of the Zetwerk network. Zetwerk showed up as a real dependable partner to its buyers and suppliers, often stepping up to help in moments of vulnerability – especially during the COVID induced lockdowns," Vaibhav Agrawal, a partner at Lightspeed, said in a statement. "The Zetwerk supply chain has emerged leaner, faster, stronger on multiple fronts post-COVID, and it is a great example of an antifragile system."

B2B marketplaces for supply chain and related services are a popular investment theme in India's fragmented industrial landscape. Recent later-stage private equity investments in this theme include OfBusiness, which helps manufacturing and construction players procure raw materials, and Udaan, which offers a range of online logistical and subcontracting services facilitated by in-house trucking and warehousing assets.

Much of the concept of these plays is to resolve India's inter-regional B2B challenges around language, culture, and internal tax barriers by approaching them online. However, investors note that fragmentation also entails a trust deficit that cannot be narrowed by a mere marketplace. Companies looking to expand their reach this way need comprehensive coverage that addresses financial and fulfillment considerations as part of the value proposition.

Lightspeed closed its third India-focused fund at $275 million last year, with a view to investing primarily at the Series A stage or earlier. The firm made at least 20 investments in India and Southeast Asia-based start-ups last year and collaborates periodically with Greenoaks, an experienced India investor.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• South Asia
• Support services
• Expansion
• Industrials
• India
• Lightspeed Venture Partners
• Greenoaks Capital
• Sequoia Capital
• manufacturing
• Logistics
• SME