Merchant payments and financial services provider BharatPe has raised $370 million in a primary and secondary mix, as a part of a Series E funding round led by new investor New York-based Tiger Global Management.
Other new investors include Dragoneer Investor Group and Steadfast Capital, who have participated as a part of this round.
The round makes BharatPe the latest entrant to India’s growing list of unicorn startups, with its valuation rising more than threefold to $2.85 billion in six months. The company had raised $108 million in February this year at a valuation of $900 million.
The current fundraise saw new investor Tiger Global infuse $100 million in the startup, with Dragoneer and Steadfast investing $25 million each, as a part of this round.
Existing investors Sequoia Capital, Insight Partners, Coatue Management, Amplo and Ribbit Capital have invested a combined $200 million in the company as a part of its current Series E fundraise.
The round includes a $20 million secondary raise, to create a liquidity event for employees and angel investors in the company. This is the third liquidity event for BharatPe’s employees with vested options.
Suhail Sameer, who was the group president, is now the chief executive officer (CEO) and will be responsible for driving the company’s monetization, lending and recent banking foray. He will also join BharatPe’s board of directors.
BharatPe co-founder Ashneer Grover will assume the role of managing director at the company and will continue driving its strategy, technology and product functions, as well as managing capital fundraising.
“Our initial plan was to raise $250 million. However, the round was heavily oversubscribed. We believe that the $350 million primary raise will give us enough runway for the next three years, after which we may look at listing in the public markets. We still have cash in the bank from our Series C and D rounds and an overall liquidity runway of $500 million, which will keep us in good stead for future growth,” said Grover in an interaction with Mint on Tuesday. The current fundraise will be utilized to grow its existing lines of business 10-fold in next two years, according to Grover.
BharatPe will also use the funds to capitalize distressed Punjab and Maharashtra Co-operative (PMC) Bank, in partnership with Centrum Financial Services. In June, the Reserve Bank of India (RBI) had cleared the takeover of PMC Bank by a joint consortium of Centrum and BharatPe.
After RBI’s approval in June, Grover told Mint that it will collectively infuse $250-300 million (or up to ₹2,224 crore) in PMC Bank with Centrum, over the next two years.
Grover refused to comment on further plans around the PMC Bank acquisition.
BharatPe’s key business verticals include its merchant payments business, financing and financial services offerings to merchant partners.
It has a presence in close to 140 cities and plans to increase its reach to 300 towns over the next two years. It also plans to take its deployment of point of sale devices from 100,000 at present to 400,000 over the next two fiscals.
BharatPe has disbursed close to $300 million in financing to merchant partners till date and has an outstanding loan book of $100 million.
It plans to scale its overall financing to $3 billion by March 2023 with an outstanding loan book of $1 billion.
The company aims to raise $700 million in debt capital over the next two years to facilitate this credit growth.
About $10 billion in annual payment value is being processed on the BharatPe platform and the company looks to scale this to $30 billion by 2023.
BharatPe also recently announced the acquisition of multi-brand loyalty platform PAYBACK India to help its 7 million offline merchants roll out rewards and loyalty programmes for customers. This marked BharatPe’s entry into the consumer-facing segment, as it looks to launch ‘Buy Now Pay Later’ services on the PAYBACK platform.
“We do not plan to make any more acquisitions for inorganic growth for the next three years and continue to be focused on growing our current lines of business organically,” said Grover.
BharatPe also plans to double its merchant partners to 14 million by the end of fiscal year 2023.