MyMoneyMantra (MMM), a distributor of financial products, has raised Rs 104 crore ($15 million) from Dutch investment company IFSD BV and private equity firm Vaalon Capital for a 30 per cent stake in the firm.
MMM, which sells secured and unsecured loans, credit cards and insurance products, will issue convertible shares and use the proceeds to strengthen its technology, data analytics and expand its reach.
Started by chartered accountant Raj Khosla in 1989, MMM has been growing at 30 per cent in the last five years before the credit crunch. It is profitable firm with a topline of Rs 150 crore and presence in 52 cities.
It competes with distributors such as Andromeda and bankbazaar.com but follows a mixed strategy (physical + digital presence). A third of its business comes from tier-2/3 cities, and the rest from top 7 cities.
"MMM has a good management team who combine entrepreneurship and vision with great experience, relationships and reputation in the consumer finance sector with great organisational and operational skills,’’ says Daniel Brol, advisor, Vaalon Capital, which advised IFSD.
Secondly, Indian consumer finance sector is poised for growth given India’s demographics, with a potential to reach over 500 million retail finance potential customers seeking guidance on personal finance. ‘‘We look at MMM as an impact investment which will have a small but positive contribution to the Indian economy and society,’’ he says.
IFSD BV is a Dutch investment company based in Rotterdam and advised by Vaalon Capital. Vaalon Capital is a UK-based private equity and advisory firm founded in 2016 and is focused on making long-term investments in companies with significant growth potential. It has made four investments globally, and this is its maiden deal in India.