Deal focus: COVID-19 grows India's Medikabazaar

Medikabazaar first started seeing a surge in business in early 2020, when COVID-19 was limited to China and local customers of the Indian B2B medical equipment marketplace began scrambling emergency supplies. From that moment to the present, the number of customers has grown from 30,000 to 100,000.

The momentum has been punctuated by spikes of infection in the company's home market. During India's second wave around April, May and June, visitor traffic doubled, and three-quarters of the equipment moved on the platform was COVID-related. In recent months, that figure has settled to about one-fifth of equipment being COVID-related.

"The company is on a strong growth path. From last financial year to this financial year, we're at 3x growth," says CEO Vivek Tiwari.

"We are taking the business to the next level and pulling all levers to make sure that in the coming few quarters we are positioned as a unicorn and building a credible team. We want to establish ourselves as a company that is loved by customers and its employees. We intend to create a good culture within the company."

Investors have dutifully lined up, with Indian private equity firm Creagis leading a $75 million Series C round last week. Creagis, which was set up in 2019 by Prakash Parthasarathy, previously CIO of tech-focused family office Premji Invest, described Medikabazaar as its first investment. The GP aims to write checks of $30-50 million, although it can go as high as $100 million. Social impact is a core theme.

UK development finance institution CDC Group contributed $27.5 million to the round, citing a desire to prepare for India's presumed third wave of infections, especially in underserved areas. About 50% of Medikabazaar's sales are to small hospitals and nursing homes, and 60% of customers live outside metro areas.

There was also a significant contingent of Japanese investors, including Rebright Partners, one of the company's first backers, Mitsui Sumitomo Insurance Venture Capital, Toppan Printing, and Sasaki Foods; Tiwari had made a point of doing roadshows in Tokyo in the seed stages. They were joined in the Series C by Ackermans & van Haaren and Kois Holdings of Belgium, as well as India's HealthQuad Advisors.

An international push is a big part of the plan. Medikabazaar recently launched a subsidiary in the United Arab Emirates to cover the Middle East and North Africa. There are longer-range plans to enter other markets with acute shortages of quality medical products, including Bangladesh, Indonesia, and Myanmar.

Operations encompass a suite of products, including the flagship marketplace, various procurement and financing tools, a truck and drone logistics fleet, a used equipment recycling service, an education portal, and an advertising platform. There are 30 fulfillment centers in 30 cities currently, and this is expected to grow to 200 in the next 6-8 months.

"Our idea is not just to go there [international expansion markets] and be another competitive seller. Our idea is to make use of the best resources available in the country and use technology as a medium to aggregate those resources for our customer," Tiwari says.

"We will work with the local resources first, the local sellers and OEMs [original equipment manufacturers], and then augment that with international OEMs. If they do not have a presence there, they can use Medikabazaar as a partner to enter. That's the way Amazon does it."

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• Topics
• South Asia
• Healthcare
• Technology
• Expansion
• India
• TMT
• CDC Group