Udaan is shrinking to survive

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Editor's note: For a few weeks now, B2B e-commerce startup Udaan has been in talks to raise a big funding round. The discussion with investors to raise money through convertible notes—debt that converts into equity at a later date—is nearing conclusion. The amount raised by the company will be around $200 million, says a person aware of the developments.  The Economic Times was the first to report last week that Udaan is going to raise $150-200 million.  Earlier this year, in January, Udaan had raised $275 million in a mix of convertible notes and debt.  The upcoming fundraise is different—and significant—for three reasons. One, even amid a funding winter, Udaan has managed to avoid a down round. The person cited above confirmed that the new funding round won’t be a down round and that the valuation is higher than the over $3 billion at which Udaan was last valued; we could not ascertain the valuation at which the company is raising. Additionally, venture capital firm Lightspeed Venture Partners, which owns more than 40% of Udaan and has invested about $400 million in …