Groupon Inc. has just announced the investment of Sequoia Capital, a private equity firm, to its Indian unit, Groupon India, according to a press release issued by the company.
Eric Lefkofsky, CEO of Groupon, said in the press release that there is a big potential in the Indian market.
"Our decision to bring in Sequoia is expected to provide the additional resources our India business needs to grow and become a true local commerce leader," he said. "We look forward to watching the business grow and evolve as a continued shareholder in the company."
A report from the Economic Times states that the new unit will be renamed to Nearbuy starting Monday.
The new rebranding will also signify that Groupon India will be focusing more on mobile apps.
The Economic Times added that the focus on the mobile app will help the company connect its buyers with deals in their local area.
Mobile devices have been a big part of the company as it provides Groupon India with about 60 percent of its traffic and about 40 percent of its business.
Ankur Warikoo, CEO of Groupon India, told the Economic Times that Groupon India's path to becoming a local leader in commerce may not be the same path that Groupon follows globally.
"India is a massive market and requires attention that Groupon can't do as part of its 48-country portfolio," he said.
Groupon India will continue to operate under Warikoo's leadership, according to the press release.
The Economic Times added that the new entity will have one representative each from Sequoia and Groupon as part of the new company's board of directors.
The new company also received about Rs 100 crore, or $15.7 million in investments from Sequoia.
The Economic Times also added that Groupon will remain a minority stakeholder, under the new dispensation.
"We raised fresh capital and fresh equity infusion and by virtue of that Groupon's ownership in the company has been reduced from 100 percent to a minority ownership," Warikoo told the Economic Times.
