Udaan, a B2B trade platform startup from India, has raised $280 million in a Series D funding round, accumulating funds to fend off its rivals.

The round was led by Moonstone Capital and Octahedron Capital, alongside Lightspeed Venture Partners, GGV Capital, partners of DST Global, Altimeter Capital, and Tencent.

This is an extension of the Series D round and not a new financing round. Udaan has already secured $585 million before the new capital, valuing the company at $3.1 billion.

The B2B market in India is unorganized. Therefore, merchants have to travel to other cities for them to stock up their inventory. Not having much to negotiate, they also struggle to find the best value for money. They also don't have a wider selection of catalogs.

Udaan, along with three co-founders who are former Flipkart executives, is solving this problem. It is now serving more than 3 million retailers, small and medium-sized businesses by connecting small retailers with wholesalers and traders.

They have also signed up with famous brands like Coca-Cola, Boat Lifestyle, PepsiCo, HP, LG, Micromax, HUL, ITC, and P&G.

"Udaan is at the forefront of this uniquely Indian e-commerce opportunity, emerging in the last four years as one of the largest e-commerce platforms in India while taking an India-first mobile-first approach to e-commerce. This financing enables us to further our journey of taking e-commerce to the depth and breadth of the country, with Udaan's unique, low-cost model for core middle India," said Amod Malviya, co-founder of Udaan.

Aside from the inventory problem, Udaan also helps merchants secure working capital, small-sized businesses that rely on money secured from selling their existing inventory to buy the next batch.