February 7, 2025: Info Edge India, an online classifieds company commitment of Rs 1,000 crore (approximately $115 million) to the IE Venture Investment Fund III signals a major step forward in the company’s strategy of fostering tech-driven Indian startups.. This fund is a collaboration between Info Edge and Temasek, Singapore’s sovereign wealth fund. The total size of the fund is projected to exceed Rs 2,000 crore ($230 million).
A Strategic Commitment with Significant Benefits
This latest investment marks a pivotal moment for Info Edge as it continues to diversify its portfolio beyond its flagship recruitment platform, Naukri.com. By channeling significant capital into IE Venture Investment Fund III, Info Edge is not only fortifying its venture capital arm but also setting the stage for promising returns from the rapidly evolving Indian startup scene.
The primary focus of the fund will be on tech-driven startups, a sector that is currently experiencing explosive growth in India, and one that holds immense potential for high returns. With this large-scale commitment, Info Edge is reinforcing its long-term vision of bolstering its financial portfolio while staying at the forefront of India’s digital transformation.
The fund’s hybrid model, which allocates initial investments to early-stage companies and sets aside funds for follow-on investments, mirrors Info Edge’s cautious yet aggressive approach to venture capital. The firm’s ability to balance both direct investments from its balance sheet and structured fund-backed bets makes it well-positioned to navigate the fluctuating risks of early-stage startups while reaping the benefits of successful scale-ups.
Building on Past Successes
Info Edge’s venture capital efforts are not new, having a proven track record in the startup investment space. One of the company’s most notable success stories is its early-stage investment in Zomato, where it acquired a stake for just Rs 4.7 crore. As the food delivery giant grew, online classifieds company’s stake increased, ultimately culminating in a highly profitable exit during Zomato’s IPO in 2021. This exit alone earned Info Edge over Rs 3,000 crore, solidifying the company’s reputation for making shrewd and profitable investments.
Beyond Zomato, the online classifieds company has been a driving force behind several other high-growth startups, including Policybazaar, ShopKirana, Gramophone, DotPe, Adda247, NoBroker, and Univariety.
The company has deployed over Rs 2,000 crore ($250 million) into various startups, often taking minority stakes while providing operational expertise to its portfolio companies. Despite some setbacks, such as its investments in 4B Networks and ShopKirana, Info Edge’s commitment to high-impact startups remains unwavering.
Financial Stability: An Important Pillar for Expansion
Alongside its growing venture capital portfolio, Info Edge’s core business remains solid. The company’s latest quarterly results reflect steady growth, with total revenue reaching Rs 675.7 crore, a 9.6% increase from the previous year.
While recruitment services through Naukri.com continue to be a significant contributor to revenue, the company’s other business verticals are gaining momentum. Real estate platform 99acres, matrimonial service Jeevansathi, and educational portal Shiksha saw notable growth, diversifying Info Edge’s income streams and reducing its historical dependence on recruitment services.
This diversification has become increasingly important, as the revenue from Naukri.com grew at a slower pace of 6.9% year-on-year, compared to the impressive growth in emerging segments.
In fact, 99acres saw a 17.6% increase, reflecting a resurgence in India’s real estate market and a surge in digital platform adoption. Additionally, Shiksha saw a 15.8% growth, driven by rising engagement from students and educational institutions.
However, despite the strong performance from emerging business verticals, profitability showed a slight dip, with EBITDA at Rs 204.6 crore and net profit decreasing by 14.7%. This decline was largely due to higher operational expenses and lower gains from financial investments, a reminder of the growing cost of supporting long-term growth initiatives.
A Sign of Confidence and Vision
Info Edge India’s substantial investment into the IE Venture Investment Fund III underscores the company’s deep confidence in the future of India’s tech-driven startup ecosystem.
By increasing its financial commitment to this fund, Info Edge is not only expanding its footprint in the venture capital space but is also positioning itself to be at the heart of India’s digital revolution. As tech-driven startups continue to thrive in India, Info Edge’s calculated investments are likely to yield significant returns, solidifying its position as a leader in both the recruitment and venture capital sectors.
With a well-rounded approach that combines strong internal business growth with strategic investments in startups, Info Edge India is poised for continued success in the coming years.
