Online healthtech platform 1mg has turned a unicorn as it raised close to $40 million in a fresh funding round led by Tata Digital. The Tata-owned company is now valued at between $1.25 and $1.30 billion, as per multiple media reports.
“The new financing has happened at a significant premium though the discussions were for a higher valuation before the markets turned choppy. This is also for the time being and the company will look to raise a bigger round later this year or next year,” Economic Times reported a source as saying.
Unicorns are privately owned companies with a valuation of $1 billion or more.
Tata-owned 1mg has so far raised $230.8 million across 16 fundraising rounds, including the latest one one. Apart from Tata Digital, those who participated in the round include existing investors MPOF Mauritius, HBM Healthcare Investments, KWE Beteiligungen and others.
Tata Digital has till date infused around Rs 254.63 crore (roughly $32 million) for 24,711 shares of the company, as per the the filing on Registrar of Companies.
“Around $1 million more is coming. Besides Tatas, some other existing investors have participated in the round,” according to another person quoted by the Economic Times.
1mg has become the third company under the Tatas’ e-commerce section to become a unicorn, after e-grocer BigBasket and Mukesh Bansal’s Cultfit rose to a valuation of $1 billion earlier.
According to a filing at the corporate affairs ministry, the board of 1mg has passed a special resolution to allot 30,992 equity shares with a face value of Re 1 each at a premium of Rs 1,03,046. Since the, the company has raised Rs 319.36 crore or about $40 million.
As per the Annual Report of Tata Sons, Tata Digital has invested in a majority stake at 1mg, its digital health company.
“On 9 June 2021 (acquisition date), Tata Digital Private Limited, a subsidiary, acquired controlling equity stake of 58.37 per cent) in Tata 1MG Technologies Private Limited (formerly known as 1MG Technologies Private Limited) (“IMG’) by payment of cash. The acquisition of 1MG improves the Group’s capacity to deliver exceptional customer experience and high-quality healthcare goods and services in the e-pharmacy and e-diagnostics market through a technology-led platform,” Tata Sons said in its 2022 Annual Report.
Further, in September 2021, Tata Digital acquired an additional 1.90 per cent stake in 1mg for Rs 44.92 crore increasing its ownership interest from 58.37 per cent to 60.28 per cent. “Further, On 1 December 2021, Tata Digital acquired an additional 2.70 per cent stake in 1mg for 0.29 crores increasing its ownership interest from 60.28 per cent to 62.97 per cent as at 1 December 2021,” said the annual report.
Tata 1mg has become a unicorn at a time when late stage fundraising has become more difficult, and is the 21st startup to become unicorn this year.