Jai Kisan, a fintech startup aimed at rural India, raises $30 million

Jai Kisan, an Indian startup that is attempting to bring financial services to rural India, where commercial banks have a single-digit penetration, said on Monday it has raised $30 million in a new financing round as it looks to scale its business.

Hundreds of millions of people in India today live in rural areas. Most of them don’t have a credit score. The professions they work on — largely farming — aren’t considered a business by most lenders in India. These farmers and other professionals also don’t have a documented credit history, which puts them in a risky category for banks to grant them a loan.

Much of the credit these people do raise ends up getting invested in unproductive usage, which leads to higher interest and default rates.

Three-year-old Mumbai-headquartered Jai Kisan is attempting to address this by treating farmers and other similar professionals as businesses instead of consumers.

The startup has developed its own system — which it calls Bharat Khata — that is helping individuals and businesses get access to cheaper financing and ensures that the money they raise is being used for agri-inputs and equipment and other income generating purposes and enablement of rural commerce transactions.

Arjun Ahluwalia, co-founder and chief executive of Jai Kisan, said financial services is crucial for these individuals as their entire economy depends on it. “The ability to buy now and pay later is how most people shop for things in India. Credit is an expectation by the Indian customer — it’s not a value added service,” he told TechCrunch in an interview.

“If there is availability of formal financing to customers, it’s not just customer who does well. The entire ecosystem that revolves around that customer benefits,” he said, pointing to the rise of Bajaj Finance, which has helped several businesses flourish in India by giving credit to customers at the time of purchase, and Xiaomi, India’s largest smartphone vendor, which sells a large number of its devices to customers on monthly instalment plans.

Ahluwalia at a conference in 2019 (India FinTech Forum)

Bharat Khata service, which was launched in April last year, captured more than $380 million of annualized GTV run-rate across over 25,000 storefronts by the financial year that ended in March this year, the startup said.

“Jai Kisan has financed over 15% of the transactions which portrays the monetizability and quality of commerce being captured. The ability to have visibility and virality of high-quality transactions has enabled Jai Kisan to scale business by over 50% in 3 months. The unprecedented growth trajectory stands testament to Jai Kisan’s capabilities to deploy capital efficiently by focusing on core customer credit needs,” the startup said.

The startup, which operates in eight Indian states in South India, is now looking to scale its presence across the country and also increase the headcount. On Monday, it said it had raised $30 million in a Series A round led by Mirae Asset, Syngenta Ventures, and existing investors Blume, Arkam Ventures, NABVENTURES, Prophetic Ventures and Better Capital.

An unspecified amount of the financing was raised as debt from Blacksoil, Stride Ventures, and Trifecta Capital.

“Jai Kisan is at the cusp of disrupting the rural financing industry and we’re glad to be a part of their growth story. Jai Kisan’s stellar growth, excellent asset quality and expanding footprint make them a highly differentiated player in the segment,” said Ashish Dave, chief executive of the India Venture Investments for the South Korean firm Mirae Asset.

“Mirae Asset has always believed in backing companies which aim to become category leaders which is evident from our other investments and we believe Jai Kisan is on the journey of doing so for rural finance,” he added.

Like most fintech startups, Jai Kisan has so far relied on its banking and other financial institutions to finance credit to businesses. The startup said it will now finance 20% of all loans by itself. Which is why it is also raising some money in debt in the new round.

#asia, #better-capital, #blume-ventures, #funding, #india, #mirae-asset, #tc, #trifecta-capital

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Tiger Global leads $30 million investment in Indian Twitter rival Koo

Investors are backing Koo, an Indian alternative to Twitter, with large size checks at a time when tension is brewing between the American social network and New Delhi.

The Indian startup said on Wednesday it has raised $30 million in a financing round led by Tiger Global Management. Mirae Asset and IIFL’s venture capital fund and existing investors 3one4 Capital, Blume Ventures, and Accel also participated in the round, which valued the Bangalore-based startup at over $100 million, up from about $25 million in February.

Like Twitter, Koo app allows users to send out posts in English and half a dozen Indian languages. The app has gained popularity in India in recent months following flare-ups between Twitter and the Indian government after the San Francisco-headquartered firm refused to block accounts that criticized New Delhi and Prime Minister Narendra Modi earlier this year.

(The Indian government, like Singapore’s, also ordered Twitter and Facebook last week to take down posts that identified a new variant of the coronavirus as “Indian variant”. Also last week, New Delhi objected to Twitter’s labeling of some of its politicians’ tweets as manipulated media. Earlier this week, police in Delhi visited Twitter offices to “serve a notice.”)

Several prominent government officials — including Commerce Minister Piyush Goyal, Information and Broadcasting Minister Prakash Javadekar, Union Cabinet Minister Smriti Irani, Electronics and IT Minister Ravi Shankar Prasad — and many celebrities have signed up on Koo in recent months and urged their followers to follow suit.

Though the app, co-founded by Aprameya Radhakrishna (who also co-founded TaxiForSure, which was sold to local giant Ola; and is a prolific angel investor), has won the trust of investors, it is yet to gain ground.

One-year-old Koo app had fewer than 6 million monthly active users in India in April, according to mobile insight firm App Annie (data of which an industry executive shared with TechCrunch).

The startup says it aims to build a social network for the entire nation and not just a fraction of it. Twitter remains largely popular among users in urban cities in India.

Koo, whose initial traction has been credited to Hindu nationalists, is currently one of the handful of social networks that has complied with India’s new IT rules that grant New Delhi greater power to take down posts it deems offensive.

The revised IT rules, announced in February, would put an end to “double standards” by making platforms more accountable to the local law, government officials said then. Failure to comply might bereft social networks of safe harbor protection.

The deadline to comply with the new rules expires on Wednesday. Facebook, which identifies India as its largest market, said it “aims to comply” with the new rules, while Google said in a statement that it “respects” India’s legislative process.

Koo is the latest investment from Tiger Global in India this year. The hedge fund, which has backed over 20 Indian unicorns, has emerged as the most prolific investor in Indian startups in recent months, winning founders with its pace of investment, check size, and favorable terms.

#3one4-capital, #accel, #apps, #asia, #blume-ventures, #facebook, #google, #india, #social, #tiger-global, #twitter

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Indian beauty e-commerce Purplle raises $45 million

Purplle, an e-commerce platform for beauty products in India, said on Monday it has raised $45 million in a new financing round as it looks to expand its presence in the world’s second largest internet market.

The new round, a Series D, was financed by Sequoia Capital India and existing investors Verlinvest, Blume Ventures, and JSW Ventures. The new round values the Indian startup — which has raised $95 million to date — at about $300 million, up from $150 million in its 2019 Series C round, a person familiar with the matter told TechCrunch.

The new round gave partial exit to IvyCap Ventures, which had invested about $2 million in Purplle in 2015. The venture firm said in a statement that Purplle delivered a 22X return and 1.35x of its entire Fund 1.

“We continue to believe in the growth of the company and therefore we have retained our stake for Fund 2,” said Vikram Gupta, Founder and Managing Partner of IvyCap Ventures.

Eight-year-old Purplle.com, which counts Goldman Sachs among its investors, says it sells nearly 50,000 products from over 1,000 brands. The startup said it has amassed 7 million monthly active users.

“Purplle has been on a robust growth trajectory. Even with a Covid year, we have delivered >90% GMV CAGR for the last 3 years. This, while scaling our private brands successfully; Good Vibes is already an INR 150 Cr [$20.7 million] brand. The investment will help to shape Purplle into a multibillion-dollar, digital-first, beauty and personal care enterprise,” said Manish Taneja (pictured above), co-founder and chief executive of Purplle, in a statement late Monday.

The growth of Purplle is indicative of the growing e-commerce space in India, where users are beginning to purchase fashion and beauty products online. MyGlamm, an omnichannel direct-to-consumer Indian brand, last week raised $24.2 million in a round co-led by Amazon.

“We are excited to partner with Purplle as we believe they have cracked the beauty playbook of value retailing with 3 key tenets – a business built on high retention and low customer acquisition cost (CAC), a wide assortment of brands offering quality at best prices, and an attractive private label portfolio mix. We see Purplle emerging as a dominant beauty destination as the online beauty penetration grows from 10% to 25%+ over the next decade,” said Sakshi Chopra, Principal, Sequoia India.

#asia, #blume-ventures, #ecommerce, #funding, #goldman-sachs, #india, #nykaa, #sequoia-capital-india

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India’s insurance platform Turtlemint raises $30 million

Turtlemint, an Indian startup that is helping consumers identify and purchase the most appropriate insurance policies for them, has raised $30 million in a new financing round as it looks to reach more users in small cities and towns in the world’s second largest internet market.

The new round, the five-year-old Mumbai-headquartered startup’s Series D, was led by GGV Capital . American Family Ventures, MassMutual Ventures and SIG, and existing investors Blume Ventures, Sequoia Capital India, Nexus Venture Partners, Dream Incubator and Trifecta Capital also participated in the round, which brings Turtlemint’s total to-date raise to $55 million.

Only a fraction of India’s 1.3 billion people currently have access to insurance. Insurance products had reached less than 3% of the population as of 2017, according to rating agency ICRA. An average Indian makes about $2,100 a year, according to the World Bank. ICRA estimated that of those Indians who had purchased an insurance product, they were spending less than $50 on it in 2017.

A range of startups in India are trying to disrupt this market. Analysts at Goldman Sachs estimated the online insurance market in India — which in recent years has attracted several major giants including Amazon and Paytm — to be worth $3 billion in a report they recently sent to clients.

Another major reason why existing insurance firms are struggling to sell to consumers is because they are too reliant on on-ground advisors.

Turtlemint co-founders Anand Prabhudesai (left) and Dhirendra Mahyavanshi pose for a picture (Turtlemint)

Instead of bypassing these advisors, Turtlemint is embracing them. It works with over 100,000 such agents, equipping them with digital tools to offer wider and more relevant recommendations to consumers and speed-up the onboarding process, which has traditionally required a lot of paperwork.

These advisors, who continue to command over 90% of all insurance sales in the country, “play a critical role in bridging the gap in tier 2 and 3 towns and cities, where low physical presence of insurance companies greatly impacts seamless access to insurance products and information,” the startup said.

Turtlemint works with over 40 insurance companies in India and serves as a broker, charging these firms a commission for policies it sells. The startup said it has amassed more than 1.5 million customers.

“By developing products for the micro-entrepreneurs and the rising middle class, Turtlemint has an opportunity to have a positive impact on India’s economy,” said Hans Tung, Managing Partner at GGV Capital, in a statement. “Dhirendra, Anand, and their team built an incredible platform that enables over 100,000 mom-and-pop financial advisors to serve consumers’ best interests with digital tools, helping middle-class families in India get insured with the best products available.”

In an interview with TechCrunch, Turtlemint co-founder Anand Prabhudesai said the startup will deploy the fresh capital to grow its network of advisors and improve its technology stack to further improve the experience for consumers. The startup today also offers training to these advisors and has built tools to help them digitally reach potential customers.

“Continuous education is a very important aspect of being a successful financial entrepreneur. To this end, we have created an online education product with a wide range of courses on financial products, advice-based sales techniques and other soft skills. Our content is now available in seven regional languages and over 20,000 learners are active each month on our edtech platform. A lot of these are first-time advisors who are taking their first steps towards starting their advisory business. Our target is to create a million successful financial entrepreneurs over the next 3-5 years,” he said.

#american-family-ventures, #apps, #asia, #blume-ventures, #dream-incubator, #finance, #funding, #ggv-capital, #india, #massmutual-ventures, #nexus-venture-partners, #payments, #sequoia-capital-india, #sig

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Blume Ventures’ Karthik Reddy on Indian startup ecosystem, geo-political tension with China and coronavirus

Despite the coronavirus outbreak, which has slowed down deal-making across the world, dozens of startups in India have raised considerable amounts in recent months. Unacademy, which raised $110 million in February, closed a new round of $150 million this month.

These large check sizes, and the frequency at which they are being bandied out, were almost unheard of in India just 10 years ago. The list of problems these local startups were solving then was also quite smaller back in the day.

Karthik Reddy has seen this change very closely.

He co-founded venture capital firm Blume Ventures, where he also serves as a partner, 10 years ago. Blume Ventures is the largest Indian venture capital firm. In a wide-ranging interview at Disrupt 2020, Reddy talked about the state of the startup ecosystem in India, some of the challenges it is confronting today and what lies ahead for the market.

“Fifteen years is what you should consider the active VC build-out in India. For the first five to seven years, we were kind of faking it till we make it. We sold the idea that we can replicate what the U.S. and China have done,” he said.

The breakout moment in India happened when low-cost Android smartphones flooded the market. A handful of startups with consumer-facing services such as Flipkart, Paytm and Zomato emerged to serve the first tens of millions of smartphone users in the country.

“The Hail Mary moment there was Reliance Jio’s arrival in the market,” he said. India’s richest man, Mukesh Ambani, entered the telecommunications market in the second half of 2016 with the world’s cheapest mobile tariff.

Moreover, for several months, Ambani simply did not charge Jio subscribers anything for access to 4G data. So India at large, once conscious about each megabyte it spent on the internet, suddenly started consuming gigabytes of content everyday. “It democratized data and smartphones at a scale that we have not seen in countries other than China,” said Reddy.

Karthik Reddy is the co-founder of Blume Ventures, the largest Indian venture capital firm

As hundreds of millions of users in India arrived on the internet, scores of startups in the country started to solve more complex problems: Bangalore-based startup Meesho today is helping millions of women sell products digitally; Classplus, a Blume Ventures-backed startup, has built a Shopify-like platform for teachers and coaching centres to serve students directly.

As India grew into the world’s second largest internet consumer, it has also attracted American and Chinese technology groups, all of which are looking for their next billion users. Several major investment firms, including Silver Lake, Alibaba Group, Tencent, GGV Capital, Tiger Global, General Atlantic, KKR, Vista, and Owl Ventures have also arrived and become aggressive in their investments in recent years.

But the geo-political tension between India and China have slightly complicated matters. In April this year, India amended its foreign direct investment policy to China to seek approval from New Delhi for their future deals in the country. Chinese investors have ploughed billions of dollars into the Indian startup ecosystem in recent years.

It’s a sensitive topic, given the involvement of the government, that most VCs in India are not comfortable addressing it even off the record. But Reddy weighed in.

“If not an arm or limb, it cuts off a finger or two for your choices. You are a little handicapped,” he said. “But there’s a caveat to that. It’s limited to certain segments of the market. I don’t think China and Hong Kong investors, even though they were very familiar with Chinese VC success story, were really interested in India’s deep tech and cross-border tech,” he said.

Today those areas account for more than a third of the robust ecosystem in India, Reddy argued. “If you look at the entire ecosystem collectively, there’s a single-digit influence of Chinese capital. […] If you ask me personally, 40% of my portfolio is not even remotely affected by it,” he said.

But several large consumer-facing Indian startups, such as Paytm, Zomato and Udaan, do have Chinese investors on their cap tables. Reddy said they would be impacted as uncertainty looms over when — and if — India would offer any relaxation to its current stand.

He said he is hopeful that the government would provide some distinction to VC-managed fund money that is not necessarily Chinese just because it’s run by someone who originated there.

Reddy also spoke about why he thinks early-stage startups, despite the proliferation of VC firms in India focusing on young firms, continue to receive less attention. We also spoke about how the coronavirus is impacting his portfolio startups and the industry at large and what advice he has for startup founders to navigate the turbulence times. You can watch this and much more in the interview below.

#alibaba-group, #asia, #blume-ventures, #china, #disrupt, #disrupt-2020, #india, #karthik-reddy, #startups, #techcrunch-disrupt, #unacademy, #venture-capital, #zomato

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India’s first Earth-imaging satellite startup raises $5 million, first launch planned for later this year

Bengaluru-based Pixxel is getting ready to launch its first Earth imaging satellite later this year, with a scheduled mission aboard a Soyuz rocket. The roughly one-and-a-half-year old company is moving quickly, and today it’s announcing a $5 million seed funding round to help it accelerate even more. The funding is led by Blume Ventures, Lightspeed India Partners, and growX ventures, while a number of angel investors participated.

This isn’t Pixxel’s first outside funding: It raised $700,000 in pre-seed money from Techstars and others last year. But this is significantly more capital to invest in the business, and the startup plans to use it to grow its team, and to continue to fund the development of its Earth observation constellation.

The goal is to fully deploy said constellation, which will be made up of 30 satellites, by 2022. Once all of the company’s small satellites are on-orbit, the the Pixxel network will be able to provide globe-spanning imaging capabilities on a daily basis. The startup claims that its technology will be able to provide data that’s much higher quality when compared to today’s existing Earth imaging satellites, along with analysis driven by PIxxel’s own deep learning models, which are designed to help identify and even potentially predict large problems and phenomena that can have impact on a global scale.

Pixxel’s technology also relies on very small satellites (basically the size of a bear fridge) that nonetheless provide a very high quality image at a cadence that even large imaging satellite networks that already exist would have trouble delivering. The startup’s founders, Awais Ahmed and Kshitij Khandelwal, created the company while still in the process of finishing up the last year of their undergraduate studies. The founding team took part in Techstars’ Starubst Space Accelerator last year in LA.

#aerospace, #artificial-intelligence, #bengaluru, #blume-ventures, #earth, #google, #imaging, #learning, #lightspeed-india-partners, #louisiana, #mentorships, #outer-space, #private-spaceflight, #recent-funding, #satellite, #small-satellite, #space, #spaceflight, #startups, #tc, #techstars

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Classplus raises $9M to grow its Shopify-like platform for teachers and coaching centers in India

An India-based startup that has built a Shopify -like platform for coaching centers to accept fees digitally from students, and deliver classes and study material online has received the nod — and capital — from a number of high-profile investors.

The business-to-business startup, called Classplus, said on Monday that it has raised $9 million in its Series A financing round led by RTP Global, a prolific investor in early stage startups. Existing investors Blume Ventures, Sequoia Capital India’s Surge, Spiral Ventures, and Strive also participated in the round, said the two-and-a-half-year-old startup.

As dozens of firms bet on hundreds of millions of students — and their parents — to embrace digital learning apps, Classplus, also backed by Times Internet, believes that tens of thousands of teachers and coaching centers that have gained reputation in their neighborhoods are here to stay.

“We are serving these hyperlocal tutoring centers that are present in nearly every nook and cranny in India. Anyone who was born in a middle-class family here has likely attended these tution classes,” said Mukul Rustagi, co-founder and chief executive of Classplus, in an interview with TechCrunch.

“These are typically small and medium setups that are run by teachers themselves. These teachers and coaching centers are very popular in their locality. They rarely do any marketing and students learn about them through word-of-mouth buzz,” he said.

Rustagi described Classplus as “Shopify for coaching centers.” Like Shopify, the service does run a marketplace that offers discoverability to these teachers or coaching centers. Instead, it offers a way for these teachers to leverage its tech platform to engage with customers (in this case, students).

Classplus has on-boarded more than 3,500 coaching centers on its platform, said Rustagi, more than 500 of which started using the service in the month of April after Prime Minister Narendra Modi’s government ordered to shut down schools and other public gatherings in a bid to curb the spread of the coronavirus disease.

Coaching centers use Classplus to digitally communicate with students, deliver video classes and other study material, and accept payments. These coaching centers can engage with their students through Classplus’ mobile app and the website. “Joining the platform is as easy as signing up for a team collaboration app. The whole process takes less than 30 minutes,” said Rustagi.

“According to the Global Teacher Status Index by the Varkey foundation in 2018, India was among the top-10 in the world in respecting teachers, though was in the last-10 in paying them. Classplus is liquidating this imbalance by empowering tutors with full-stack mobile solutions, while maintaining and further improving the high reputation of tutors. We are happy to back the company with this important mission, and have Classplus as our first edutech bet in India,” said Kirill Kozhevnikov, a partner at RTP Global, in a statement.

The startup, which employs about 200 people, aims to have 10,000 coaching centers join its platform by the end of the year. It has a sales team and other members in about 70 cities in India currently. Classplus also plans to introduce additional features for coaching centers on its platform.

#apps, #asia, #blume-ventures, #education, #funding, #rtp-global, #sequoia-capital, #shopify

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