 "Phonepe, Rahul Chari, Nandan Nilekani, PhonePe, Sameer Nigam")
Walmart-owned fintech firm PhonePe has raised an additional tranche of $100 million from private equity firm General Atlantic and its co-investors at a pre-money valuation of $12 billion.
This new funding is part of PhonePe’s ongoing fundraise of up to $1 billion in capital, following its domicile shift to India last year.
With this tranche, the company has raised $750 million from several global investors. This includes a total of $450 million from General Atlantic alone. The company expects further investments, which will be announced in due course.
“The stake of General Atlantic and other investors has not been decided as the cap table is not closed yet,” said a person familiar with the matter. He added, “There will be more infusion of capital and General Atlantic may invest more.”
PhonePe has confirmed the development.
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In February this year, the Bengaluru-based unicorn raised $350 million from General Atlantic at a pre-money valuation of $12 billion, making it the most-valued fintech player in India. Other investors that backed PhonePe include Qatar Investment Authority, Microsoft, Tiger Global and a few small hedge funds.
In the same month, PhonePe raised another $100 million in primary capital from Ribbit Capital, Tiger Global and TVS Capital Funds.
In March this year, PhonePe raised an additional $200 million in primary capital from its parent Walmart, at a pre-money valuation of $12 billion.
“I think we are on track to get to the $1-billion funding,” said PhonePe founder and chief executive officer (CEO) Sameer Nigam.
Nigam added, “All our investors, including existing and new, appreciate that our maniacal focus on customer service has helped us retain a substantial market share in our core business, which is translating into strong revenue growth.”
PhonePe plans to use the funds to scale its payments and insurance businesses in India, according to the sources. It will also launch and aggressively scale new businesses like lending, stock broking and Open Network for Digital Commerce (ONDC)-based shopping over the next few years.
For instance, this month, PhonePe forayed into e-commerce with the launch of a shopping app, Pincode, on the government-backed ONDC platform. The app will focus on hyper-local commerce.
The move is expected to help PhonePe take on players such as Flipkart, Amazon, Reliance’s JioMart and Tata-owned BigBasket in the e-commerce space. This segment is set to grow to $350 billion by 2030.
Pincode is currently live only for customers in Bengaluru and will be rolled out in other cities soon. The Pincode app will promote local shopkeepers and sellers.
It aims to digitally connect each city’s consumers with all their neighbourhood stores that they usually buy on offline mode.
PhonePe said this would be done with the convenience of online ordering, discounts and instant refunds and returns.
“We recently launched the Rupay credit card on Unified Payments Interface (UPI). I think that is a big market. We continue to expand our offering on insurance. You will see us entering health insurance soon,” said Nigam.
