WeRize raises $8mn in Series A led by 3one4 Capital, Picus and others

WeRize is a full stack provider, developing and distributing a wide range of customised credit, group insurance and savings products for 100 mn homes and 300 mn individuals in 4,000-plus small towns

WeRize, a full-stack financial services platform, has raised $8 million in Series A funding round, led by 3one4 Capital, Picus Capital, Kalaari Capital, and Orios Ventures.

Founded by ex LendingKart executives Vishal Chopra and Himanshu Gupta in 2019. WeRize is a full stack provider, both- developing and distributing a wide portfolio of customised credit, group insurance and savings products for 100 million families and 300 million individuals who live in 4000+ small towns of India. This $200 billion and growing annual market expects a very different product set as well as distribution model which traditional private banks, insurers, and mutual fund companies are unable to provide. The economics of these products as well as operating in small cities is not feasible for traditional companies due to their high-cost branch-based distribution model.

Vishal Chopra & Himanshu Gupta, co-Founders, WeRize said: “The full stack approach of owning both the product and the distribution gives us unique insights about our customer segment that becomes an unbeatable competitive advantage. With the support of our investors, we have the opportunity to reimagine financial services for a large and profitable customer base that has been inadequately served by the existing ecosystem.”

So far the company has raised slightly over $10 million. WeRize is a profitable entity and is on target to become EBITDA positive by early 2022. It has registered 10x revenue growth in the last year. The company currently caters to customers in 1000+ cities and towns and plans to reach 4000+ towns in the next 2 years through its social distribution “Social Shopify of Finance” tech platform that will have over 50,000 freelance financial consultants across India.

Anurag Ramdasan, Partner at 3one4 Capital said: “Financial services for 4000+ small towns in India is a space that has been largely untouched due to the complex nature of the space. Vishal and Himanshu have been working on this space for 2 years to build a lean, efficient approach to solving the problem for 300 million Indians. We strongly believe that their approach of designing financial products focused on families along with distributing through social model is the only way to win this huge market.”

Small town India families primarily bank with government or regional cooperative banks that  only provide a basic bank account and don’t provide other financial products such as unsecured loans, credit cards, insurances or investments. Providing access to a broader set of products in this demography requires for a more differentiated and deeper risk management capability. Small town India lives in joint families and tend to have a single P&L for the family. 

Additionally, this market needs high touch sales and after sales service which can only be profitably provided using a social distribution model. The Indian fintech ecosystem on the other hand is geared towards building do-it-yourself (DIY) apps that helps customers choose the right financial products for themselves. However, this approach doesn’t work for small town India families as there is a huge trust deficit about non-government financial products. 

Rajesh Raju, Managing Partner at Kalaari Capital said: “Small town India needs a very different set of products than is currently made available by incumbent players and a distribution model that solves the unique challenges that exist in these markets.  The full stack play by WeRize hits all the right notes and we look forward to supporting the team in the exciting next phase of growth”.