Prosus, one of the world’s largest technology investors, is doubling down on its investment in Urban Company, the leading home services platform in India. The Netherlands-based investor, known for backing several prominent Indian startups, including Swiggy, Meesho, and Eruditus, will be investing around $30 million in an all-secondary transaction. This move aims to expand its stake in Urban Company ahead of the startup’s highly anticipated public listing next year, according to sources familiar with the matter.
The $30 million transaction will allow Prosus to acquire additional shares from Bessemer Venture Partners, giving the latter a partial exit. The transaction is expected to occur at a flat valuation of $2.6 billion. Typically, secondary transactions happen at slightly lower valuations than primary ones, but in this case, the valuation remains steady.
This development comes on the heels of an earlier secondary transaction in July, when Accel Partners and Elevation Capital, two early investors in Urban Company, sold part of their stakes to Dharana Capital in a deal worth around ₹400 crore. However, both Accel and Elevation have now paused plans to sell further stakes and are expected to wait for the company’s initial public offering (IPO) next year.
“Both Accel and Elevation Partners were discussing selling larger stakes but have dropped the plans and will only look at selling at the IPO (initial public offering),” one of the people quoted above said. “There was a media report that suggested Steadview was also looking to sell, but even that’s off the table. It’s just Bessemer selling the largest chunk and small secondaries for Accel and Elevation. Urban Company is among the few good assets, and it’s an opportunity for someone like Prosus to make the most of it, double down, and see it (valuation) grow at the IPO next year.”
Despite the ongoing secondary transactions, Urban Company’s major investors, including Prosus, Accel, and Steadview, have declined to comment on the developments. A query sent to Mukul Arora of Elevation Partners also remained unanswered.
The decision by Accel and Elevation to retain their stakes contrasts with the broader trend among early-stage venture capitalists (VCs) in India. Many are opting for exits from portfolio companies as their initial fund cycles come to an end. In a report by The CapTable in April, VCs like Orios Venture Partners, Peak XV Partners, and Chiratae Ventures were reportedly looking to sell their stakes through secondary transactions.
Prosus’ move to increase its stake in Urban Company comes after a recent substantial gain from its investment in Swiggy, another Indian startup preparing for its IPO later this year. Despite facing setbacks with some of its other significant Indian investments, such as Byju’s and Pharmeasy, Prosus is focused on capitalizing on its successful ventures.
“Urban Company is among the few good assets, and it’s an opportunity for someone like Prosus to make the most of it, double down, and see it (valuation) grow at the IPO next year,” the source added.
Apart from its tech investments, Prosus has been diversifying its portfolio. In September, the firm invested $100 million in Vastu Housing Finance and is also expected to invest around $40 million in Bluestone, a jewellery platform.
Founded almost a decade ago by Abhiraj Bhal, Raghav Chandra, and Varun Khaitan, Urban Company last raised primary funding in 2021. The round included participation from investors such as Tiger Global Management, Dragoneer, Steadview, and Prosus, with the company valued at $2.6 billion at the time. The company has initiated discussions with investment banks in preparation for its upcoming IPO.
