BharatPe's valuation crosses $2.85 bn in $370 mn in Series E equity round

The funding would help the firm compete and take on players such Pine Labs, Paytm and Mswipe

BharatPe, the leading financial services company for merchants, said on Wednesday that it has raised $370 million in a Series E equity round, at a post-money valuation of $2.85 billion. The primary component of the round is $350 million and the secondary component is of $20 million. All employees holding vested employee stock ownership plan (ESOPs) have been given full liquidity in the secondary component.

The funding makes Delhi-based BharatPe the latest entrant to the coveted unicorn club. It was valued at about $900 million in its Series D round in February this year, and $425 million last year.

The new round, led by Tiger Global, also saw new participation from Dragoneer Investment Group and Steadfast Capital. Five out of the 7 existing institutional investors participated in the round - namely Coatue Management, Insight Partners, Sequoia Growth, Ribbit Capital and Amplo. BharatPe is now amongst the Top 5 most valued fintech startups in India, and has one of the strongest cap tables for any start-up in India. The funding would help the firm compete and take on players such as Pine Labs, Paytm and Mswipe.

“We now have $0.5 billion cash on books and are extremely well-capitalised to deliver on our mandate to build India’s first truly digital bank”, said Ashneer Grover, co-founder and MD, BharatPe. “Rarely does one witness the original thesis play out without any pivot. BharatPe will remain maniacally focused on lending as the core business and small merchants as our primary target segment,” he said.

Ashneer Grover, co-founder and MD, BharatPe

Grover also said that he is happy to appoint Suhail Sameer as the CEO in recognition of the stupendous business growth he has delivered during the last one year and his ability to lead from the front.

“At BharatPe, we have a high performing team attracted to our focussed execution, growth potential and culture of meritocracy,” said Grover. “I am also honoured to invite him to the Board of Directors.”

Suhail Sameer would be responsible for the overall Business and P&L, Merchant Network Expansion, Monetisation, Lending, Banking Foray and the Brand. Ashneer Grover, co-founder and CEO, will be elevated to the co-founder and managing director position and will lead strategy, product, technology, capital (IPO, equity and debt) and drive the overall People agenda for the company.

“Ashneer (Grover) has done an unbelievable job against odds, in building BharatPe to a market leader in a small span of 3 years, since inception,” said Sameer. “I am excited to be stepping in his shoes and taking over the responsibilities of CEO. I am sure that with his continued guidance and focus on building a strong tech and product core, we will be able to scale the business 10x from here. We have the team, capital, technology, brand, product, market and regulatory regime to create an immensely valuable business,” he said.

BharatPe was co-founded by Ashneer Grover and Shashvat Nakrani in 2018 with the vision of making financial inclusion a reality for Indian merchants. In 2018, BharatPe launched India’s first UPI interoperable QR code, the first zero MDR payment acceptance service. In 2020, post-Covid, BharatPe also launched India’s only zero MDR card acceptance terminals – BharatSwipe. Currently serving over 7 million merchants across over 140 cities, the company said it is a leader in UPI offline transactions, processing more than 110 million UPI transactions per month (annualised transaction processed value of over $10 billion). The company has already facilitated the disbursement of loans totalling over Rs 1,800 crore to its merchants. BharatPe’s POS business processes payments of over Rs 1,400 crore per month. The firm has raised close to $ 600 million in equity and debt, to date.

In June 2021, the company announced the acquisition of PAYBACK India, the country’s largest multi-brand loyalty program company with over 100 million members. In June 2021, it was also given in-principle approval by the Reserve Bank of India to establish a Small Finance Bank, in partnership with Centrum Financial Services Limited (Centrum), the established and profitable NBFC arm of the Centrum Group.