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The 13 biggest funded fintech stars of India

Tarush Bhalla
15th Jul 2016
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Technology is disrupting the financial sector at an unprecedented pace. From bank transfers, to payments, to loans, each financial function today has a strong play of technology, with more scope for disruptions.

That startups are tapping into this potential is evident, especially from funding patterns.

The number of fintech startups funded in the first half of 2016 equals the total number of startups funded in the sector in 2015. According to YourStory Research, $1.2 billion has already been invested in fintech startups in the last two years.

Moreover, the government also seems to be taking notice of this space. The National Payments Corporation of India (NPCI) launched its interoperable payments system, Unified Payments Interface (UPI), earlier this year. Further, the RBI is looking to regulate the P2P lending platforms and get them to register as non-banking financial corporations (NBFCs).

top-fintech-companies- yourstory

With the buzz only rising, here are the top 13 fintech companies in terms of funding received in the last two years:

#1 Paytm

Parent Company: One97 Communications 

Headquarters: Noida

Founding year: 2010

Founder: Vijay Shekhar Sharma

Area of operations: E-commerce, payment banks, and payments (wallet)

Total funding raised till date: More than $728 million

Key investors: ANT Financial, SAIF Partners, Intel Capital

Funding raised (as of 2015–16): $700 million

Funding highlights (as of 2015–16): 

February 2015

In February 2015, Alibaba-backed Ant Financial Services Group and Paytm’s parent company One97 Communications announced an agreement which saw Ant Financial take a 25 percent stake in One97 to support the growth of its mobile payment and commerce platform in India.

However, a funding of $575 million was supposed to take place in two tranches. In March, One97 had raised $200 million and was supposed to meet the targets for the second one.

September 2015

Alibaba then entered the company to invest in the second tranche, along with Ant Financial (Alibaba’s payment arm).

However, Paytm put up a requirement of a bigger tranche and Alibaba Group agreed to pump in $500 million instead of $375 million, taking the total investment to $700 million. 

This makes Alibaba Group the biggest stakeholder in One97 Communications, owning 40 percent of stake in the company.

Further, news came out in February 2016 that Paytm was looking to raise $400 million by June to help with the launch of Paytm’s new payments business, Paytm Payment Bank, although this wasn’t confirmed by the payment major. 

Vijay Shekhar Sharma
Vijay Shekhar Sharma, Founder, One97 Communications

 

#2 Freecharge

Parent company: Snapdeal (acquired on April 8, 2015)

Headquarters: Mumbai

Founding year: 2010

Founder: Kunal Shah and Sandeep Tandon

Area of operations: Mobile payments (wallet), recharges

Total funding raised till date: $120 million 

Key investors: Hong Kong-based fund Tybourne Capital Management; SF-based fund Valiant Capital Management; Sequoia Capital, along with Sofina and RuNet

Funding raised (as of 2015–16): $80 million

Funding highlights (as of 2015–16)

February 2015

After five months of raising Series B, mobile payment platform FreeCharge had raised $80 million as part of Series C funding from investors including Hong Kong-based Tybourne Capital Management and SF-based Valiant Capital Management.

Existing investors Sequoia Capital, along with Sofina and RuNet, also participated in the round.

April 2015

In April, e-commerce marketplace Snapdeal acquired Freecharge for a cash-plus-stock deal, with the majority of it in stocks and only a small part in cash.

However, FreeCharge remains a separate entity from Snapdeal.

YourStory-Freecharge-CEO
Govind Rajan (L), CEO, Freecharge and Kunal Shah (R), Co-founder & Chairman, Freecharge

 

#3 MobiKwik

Parent Company: One MobiKwik Payments Systems Pvt. Ltd. 

Headquarters: Gurgaon

Founding year: 2009

Founder: Upasana Taku and Bipin Preet Singh

Area of operations: Mobile payments (wallet)

Total funding raised till date: $85 million

Key investors: Japan’s payment gateway GMO; Taiwan-based semiconductor company MediaTek; Cisco Investments, American Express, Sequoia, and Tree Line Asia.

Funding raised (as of 2015–16): $75 million

Funding highlights (as of 2015–16)

April 2015 — Series B

In April last year, the company had raised over $25 million in multiple Series B tranches led by Tree Line Asia. Other investors in the round included Cisco Investments, American Express, and the existing investor, Sequoia Capital.

January 2016 — Series C

Early this year, MobiKwik had raised $50 million in a Series C round led by Japan’s payment gateway GMO, and MediaTek, a Taiwan-based semiconductor company. Existing investors Sequoia Capital and Tree Line Asia also participated in this round.

Upasana Taku and Bipin Preet (Co-founders of MobikWik
Upasana Taku and Bipin Preet, Co-founders of MobiKwik

 

#4 BankBazaar.com

Parent company: A & A Dukaan Financial Services Pvt. Ltd.

Headquarters: Chennai

Founding year: 2008

Founder: Rati Rajkumar, Adhil Shetty and Arjun Shetty

Area of operations: Online marketplace for loans and insurance products

Total funding raised till date: $80 million

Key investors: Amazon India, Fidelity Growth Partners, Mousse Partners

Funding raised (as of 2015—16): $60 million

Funding highlights (as of 2015—16)

July 2015 — Series C

Financial marketplace BankBazaar had raised $60 million (INR 375 crore) in Series C funding from Fidelity Growth Partners and Mousse Partners. Existing investors Sequoia Capital and Walden International also participated in the funding round.

Adhil Shetty, co-founder & CEO, Bankbazaar
Adhil Shetty, Co-founder & CEO, BankBazaar

 

#5 Lendingkart

Parent company: Lendingkart Technologies Pvt. Ltd.

Headquarters: Ahmedabad

Founding year: 2014

Founder: Harshvardhan Lunia, Mukul Sachan

Area of operations: Online lending platform for SMEs

Total funding raised till date: $42 million

Key investors: Saama Capital, Mayfield Fund, India Quotient, Bertelsmann India Investments, Darrin Capital Management

Funding raised (as of 2015–16): $42 million

Funding highlights (as of 2015–16)

July 2015 — Series A

The platform for small business loans raised a Series A round of $10 million from Saama Capital, Mayfield Fund, angel investor Shailesh Mehta, and Ashvin Chadha.

June 2016 — Series B

Just last month, the firm announced raising $32 million (Rs 205crore) in Series B funding from Bertelsmann India Investments (BII), with participation from Darrin Capital Management, India Quotient, and existing investors — Mayfield India and Saama Capital.

Out of the $32 million, $20 million was raised as equity and $12 million as debt.

HarshVardhan Lunia and Mukul Sachan (Co-founders of Lendingkart)
HarshVardhan Lunia and Mukul Sachan, Co-founders of Lendingkart

 

#6 PolicyBazaar

Parent company: ETechAces Marketing and Consulting Pvt. Ltd.

Headquarters: Gurgaon

Founding year: 2008

Founder: Alok Bansal, Yashish Dahiya

Area of operations: Online lending platform for SMEs

Total funding raised till date: $69 million

Key investors: PremjiInvest, Tiger Global, Ribbit Capital, Inventus Capital Partners, and Intel Capital

Funding raised (as of 2015–16): $40 million

Funding highlights (as of 2015–16)

April 2015 — Series D

It was reported that the Gurgaon-based digital lending platform had raised $40 million in a round led by PremjiInvest, Wipro’s personal investment vehicle.

In March 2016, media reports emerged that PolicyBazaar’s parent company, ETechAces Marketing and Consulting, had reported a loss of Rs 71 crore.


#7 Vistaar Finance

Parent company: Vistaar Financial Services Pvt. Ltd.

Headquarters: Bengaluru

Founding year: 2010

Founder: Brahmanand Hegde and Ramakrishna Nishtala

Area of operations: Online lending to SMEs

Total funding raised till date: $76 million

Key investors: Elevar Equity, Saama Capital, WestBridge Capital, and Omidyar Network India Advisors

Funding raised (as of 2015–16): Rs 250 crore ($39 million according to the exchange rate then)

Funding highlights (as of 2015–16)

September 2015

Financial Services startup Vistaar Finance had raised an internal round of funding from existing investors WestBridge Capital, Omidyar Network, Elevar Equity, Saama Capital, and Lok Capital.

WestBridge Capital led the round, investing Rs 202 crore.


 

#8 Capital Float 

Parent company: Zen Lefin Pvt. Ltd

Headquarters: Bengaluru

Founding year: 2013

Founder: Sashank Rishyasringa and Gaurav Hinduja

Area of operations: Digital lending platform for working capital finance to SMEs

Total funding raised till date: $42 million

Key investors: SAIF Partners, Sequoia Capital, Aspada, Creation Investments

Funding raised (as of 2015–16): $38 million

Funding highlights (as of 2015–16)

February 2015 — Series A 

The Bengaluru-based company had announced raising $13 million in Series A financing to support its growth. The round was led by SAIF Partners and Sequoia Capital, with participation from existing investor Aspada.

May 2016 — Series B

The digital finance company announced raising $25 million in a Series B round which was led by Creation Investments Capital Management LLC. There was also participation from its existing investors Sequoia, Aspada, and SAIF Partners.

In the past three years, Capital Float has disbursed close to over Rs 250–300 crore and has over 1,000 customers in 40 cities across the country with interest on loan amount varying from 16 to 19 percent.

YourStory-Capital-Float
Gaurav Hinduja (L) and Sashank Rishyasringa (R), Co-founders, Capital Float

 

#9 IFMR Holdings

IFMR Holdings Finance Pvt. Ltd, run by the IFMR Trust 

Headquarters: Chennai

Founding year: 2013

CEO of IFMR Holdings Finance Pvt. Ltd: Sucharita Mukherjee

Chair of IFMR Trust: Bindu Ananth

Area of operations: Financial inclusion

Total funding raised till date: $27 million

Key investors: Accion, LeapFrog Investments, Lok Capital, and Proparco

Funding raised (as of 2015–16): $26.8 million

Funding highlights (as of 2015–16)

August 2015

In August, the financial holdings platform in India raised $25 million in equity from Accion, a financial inclusion firm; LeapFrog Investments, an investor in emerging-market financial services; and Lok Capital, an Indian impact investment firm.

In this round of investment, Accion had put in $12.5 million, LeapFrog Investments spent $9 million, and Lok Capital invested $3.5 million.

At this point of time, IFMR Holdings claimed to serve millions of financially excluded households and enterprises through three businesses: IFMR Capital, IFMR Rural Finance, and IFMR Rural Channels.

March 2016

IFMR Holdings had secured $1.8 million (approximately Rs 12.5 crore) in a fresh round of funding from French development financial institution Proparco SA.


 

#10 Electronic Payments and Services

Parent company: Electronic Payments and Services Pvt. Ltd. 

Headquarters: Mumbai

Founding year: 2014

Founder: Mamallan Mani

Area of operations: Payments, outsourcing ATM services to large banks in the country

Total funding raised till date: Over $36 million

Key investors: Apis Growth Fund, Aavishkaar, and Asia Participation BV

Funding raised (as of 2015–16): $25 million

Funding highlights (as of 2015–16)

January 2016

To fund the expansion of its ATM network and acquisition plans, payment services provider Electronic Payment and Services raised funding from UK-headquartered Apis Growth Fund for $25 million.

The company’s business was reported to grow from Rs 5 crore in revenue in 2013 to Rs 130 crore in revenue in 2016. The firm plans to take this number to Rs 1000 crore by March 2018 and plans to expand its services to the African markets. 


 

#10 Mswipe

Parent company: Mswipe Technologies Pvt. Ltd.

Headquarters: Mumbai

Founding year: 2011

Founder: Manish Patel

Area of operations:Merchant acquirer and mobile POS solution provider

Total funding raised till date: Over $30 million

Key investors: Falcon Edge Capital, Matrix Partners India, Meru Capital, and DSG Consumers Partners

Funding raised (as of 2015–16): $25 million

Funding highlights (as of 2015–16):

July 2015 — Series C

In July 2015, MSwipe announced that it had closed its Series C funding of $25 million from participation from new investors Falcon Edge Capital, Ola Cabs, and Meru Capital, as well as existing investors Matrix Partners India, Axis Bank, and DSG Consumer Partners.

Then, Mswipe’s proprietary solutions were already in use with more than 25,000 merchants across India.

Manish Patel, Founder & CEO, Mswipe
Manish Patel, Founder & CEO, Mswipe

 

# 10 Citrus Pay

Parent company: Citrus Payment Solutions Pvt. Ltd.

Headquarters: Mumbai

Founding year: 2011

Founder: Amrish Rau, Satyen V Kothari, Jitendra Gupta

Area of operations: Mobile payments and payment gateway

Total funding raised till date: $32.5 million

Key investors: Sequoia Capital, Ascent Capital, BEENOS

Funding raised (as of 2015–16): $25 million

Funding highlights (as of 2015–16):

October 2015 — Series C

In October last year, payment solution company Citrus Payment raised about $25 million from existing backers Sequoia Capital, Ascent Capital econtext Asia, and BEENOS.

From Left to Right: CitrusPay founder Jitendra Gupta and Managing Director Amrish Rau
CitrusPay founder Jitendra Gupta (L) and Managing Director Amrish Rau (R)

There are other notable companies in the space which picked up considerable funding last year. Missing the mark was Ezetap which raised 150 crore approximately $23 million) last year. There are also companies like ItzCash, which received a Rs 100-crore investment commitment from its promoter Ashok Goel, and Loylty Rewardz which raised Rs 120 crore in investment last July.

Clearly, payments and lending are two categories which have been top sellers in the fintech space. Over the past two years, there have been 23 payment companies (including mobile payments) and 26 lending firms which have been invested with more than a billion dollars in funding, says YourStory Research.

Another interesting investor which keeps popping up is Sequoia Capital, which has invested in mobile wallets Citrus Pay and MobiKwik as well as loan marketplace BankBazaar.com. There is also SAIF Partners which is investor to Paytm and Capital Float.

Therefore, it seems as if the investors have finally woken up to the potential of financial technology in India. Other technology sectors like banking, e-tax filing, and loyalty management, are also picking up in terms of investments.

Thus, 2016 will see the number of funding deals in alternate fintech technologies rising and matching up to the lending and payments space. This is because users are getting increasingly comfortable at using technology to automate mundane tasks such as task filing.

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