Info Edge, the company that runs Naukri, 99acres and Jeevansathi, has informed BSE that it will be writing off its entire Rs 29.3 crore investment in the boutique online shopping site 99Labels during the current quarter.
While the company hasn’t provided any information as to why it is writing off this investment, its worth noting that Sanjeev Bikhchandani, Vice Chairman and Founder, Info Edge India had informed during InfoEdge’s Q1-FY13 earnings call that they were planning to tweak the business model of 99labels, indicating that the company wasn’t performing well. We have contacted InfoEdge for more details on this development and will update the story when we hear from them.
As stated earlier, Info Edge had invested a total of Rs 29.3 crore into 99Labels till now. This includes Rs 5 crore investment in September 2012, Rs 16 crore in May 2011 and Rs 5 crore in Q4 2011. The company had 24.41% equity stake in 99Labels as of March 31, 2012, and had 476,666 equity shares of 99Labels and 498,400 preference shares of 99Labels as of March 31, 2012.
Launched in 2010, 99Labels started off as an invitation only shopping site before opening up registrations sometime last year. The site offered merchandise for women, men and kids from luxury brands across various categories like apparel, shoes, accessories, watches, jewellery, fragrance among others and claimed to offer up to 90% off on branded goods. In conversation with Medianama, 99Labels CEO Ishita Swarup had claimed that the company has a member base of around half a million as of May 2011 and it was hosting 140-150 (sales) events a month, registering 600-700 sales a day.
InfoEdge Investments: This development follows a series of investments made by InfoEdge in its other portfolio companies like Zomato and Meritnation. The company had invested Rs 55 crore in Zomato last month, following which it had secured a controlling 57.9% stake in Zomato. Following this, it had invested Rs 30 crore in Applect Learning Systems, which runs the e-learning site MeritNation.
Earlier this month, InfoEdge had also acquired a Mumbai-based semantic resume search startup MakeSense Technologies for Rs 8 crore, in a bid to improve Naukri’s search functionality for both recruiters and job seekers.