Gradatim to explore Series A funding

Microfinance technology vendor Gradatim IT Ventures is looking at raising Series A funding of $3 million by the end of June this year as part of its aggressive expansion plans into the next phase of growth. Gradatim’s founder CEO C V Prakash said the company had engaged in discussions with a few venture capital firms and strategic investors in this direction, and would be starting a valuation process in the next 2-3 weeks.

“We will have a user base touching half a million by July this year and our transaction-based model has been a success in the microfinance sector. We also work with three banks and 14 microfinance institutions presently, managing their lending programmes,” Prakash said.

Gradatim specialises in providing services in the microfinance, microinsurance, legal discovery and insurance spaces using the Business process utilities (BPU) model. “With this model, we are among the few firms with a presence across the entire financial ecosystem. This year, we plan to establish a foothold in either Africa or South East Asia where microfinance has a growing presence,” Prakash said.

The BPO model works on pay-per-use pricing and delivers hosted services on well defined modules which can be customised to different customer requirements. Gradatim’s clients are primarily drawn from banks, microfinance bodies and non-banking finance companies.

“We have focussed on alternative banking channels, with emphasis on managing the lending process in pockets not covered by traditional banking systems,” Prakash said. “Even while we have seen a slowdown in FII inflows into the country, we have not seen a slowdown in lending activity where we see great scope for further growth. We expect to grow five times in 2009 over last year.”

Prakash earlier founded companies like Indecomm Global Services and TRRS Imaging Ltd, which was merged with the former in 2003. Indecomm’s services are completely non-voice based.

Started in early 2007, the 40-people strong company has offices in India, Australia and Singapore and is keen to pursue a buyout and investment plan to fastrack growth.

Last year, Gradatim finalised a joint venture with Singapore-based DM Corporation (DMC), a data gathering services company, to form Gradatim -– DMC in Singapore. Gradatim-DMC provides litigation processing and data conversion services in the Asia-Pacific region.