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Tag: fintech

  • The Complete Ashneer Grover Controversy involving BharatPe Board and Kotak Bank

    Ashneer Grover has turned out to be quite a famous name in the startup ecosystem and beyond it. Though Grover has been recognized popularly as the Co-founder and MD of Bharatpe, who has left the organization recently, the popularity of Grover is also due to the fact that he is a judging investor on the reality TV show “Shark Tank India”. The show is the Indian adaptation of Shark Tank, which was famous worldwide, originating from the west. The show offers a clear view of the natural attitudes of venture capitalists in the business world. Here, Ashneer is probably the most famous shark in the Indian adaptation of Shark Tank.

    Ashneer is a straight face investor who just speaks when he can add value, but when he speaks, he is brutally honest and mostly rash with words. He is the human adaptation of the idiom, “When it rains, it pours”. Shark tank is one of the hottest shows right now.

    Ashneer has also made a series of news and headlines for some other things at his organisation. The BharatPe founder has been in the headlines for multiple reasons. The board of directors and other key people are also in the limelight for some questioning. This article talks about the series of events that happened and the consequences which the events took.

    A Little Brief about the Ashneer Grover Controversy
    Ashneer Grover Vs The Board of BharatPe
    Why is BharatPe Under Scrutiny of RBI?
    Ashneer Grover and Kotak Bank Controversy
    Grovers and the Allegations Against Them

    A Little Brief about the Ashneer Grover Controversy

    The headlines have been covering Ashneer and the company a lot recently. The news is that the Co-founder and MD of BharatPe, who has reportedly resigned from the organization that he founded, Ashneer Grover, had previously written to the board of directors to remove Suhail Sameer from the board. Suhail is a co-founder too and he is also the current Chief Executive Officer of the Fintech startup BharatPe. There has been a lot of ruckus around the company.

    When Ashneer Grover went on a voluntary leave in January, Suhail was made in charge of operations at the headquarters located in New Delhi. Suhail was also promoted to the post of Chief Executive Officer in August last year. All of this ruckus started when Ashneer engaged in a controversial audio clip with a Kotak Mahindra bank employee where he abused him in an alleged call over the financing for the Nykaa IPO. His voice circulated all over social media and he was also criticized severely. Ashneer was eventually asked to take a voluntary leave of absence till the end of March along with his wife and some other Bharatpe employees, which eventually turned into a mandatory leave of absence. Besides, the news was also ripe that the board of directors is in an attempt to scrutinize the financial frauds that Ashneer, his wife, and some other employees, who are allegedly involved with the same and this might also see Ashneer and his wife out of the company along with the others.

    He responded strongly to the matter. He was also individually and independently examined for his governance in the company.

    According to Ashneer, he is being arm-twisted into venturing out from the startup he built along with Suhail. He also mentioned that he was the one who chose Suhail to be the key person in the company and now Suhail is siding with the board to expel him.

    Ashneer also replied that if the company wants to expel him, he wants his worth out of the company. At a valuation of 6 billion dollars, the 9.5% of shares that Ashneer has stands at ₹4000 crores. If the company wants to buy him out, it needs to put his ₹4000 crores on the table, he explained.

    The financial frauds updates dated February 23, 2022, that entangled Mr. and Mrs. Grover along with some other BharatPe employees states that Madhuri Jain Grover, the wife of Ashneer Grover, was fired by the Board of BharatPe due to alleged irregularities and has also cancelled the ESOPs vested with her. Though an official statement from the company is still pending, Madhuri’s termination has been confirmed by a spokesperson close to the matter. Fast forward to February 28, 2022, Ashneer Grover resigned from BharatPe with immediate effect following the termination of his wife. With his resignation, Grover also steps down from the positions of Co-founder and Managing Director. Ashneer was recently rejected an emergency arbitration plea, which he filed with the Singapore International Arbitration Centre (SIAC), who tossed out all the 5 pleas that Grover made and left him without a single relief.

    “I write this with a heavy heart as today I am being forced to bid adieu to a company of which I am a founder. I say with my head held high that today this company stands as a leader in the fintech world,” writes Ashneer Grover.  

    Grover’s letter said time and again that he and his family had suffered continuous vilification, for which he had to finally resign. Meanwhile, BharatPe has claimed that the resignation letter of Ashneer Grover was dropped minutes after he received the agenda for a board meeting, which would also include a report submitted by PWC regarding the conduct of Grover, and considering actions on it, as per the reports dated March 1, 2022. However, Grover also claimed that though he is resigning he will still stand as “single largest individual shareholder of the company.”

    Ashneer Grover Vs The Board of BharatPe

    Ashneer was in the news with a lot of headlines. One of the headlines was the board of a company trying to remove him from the startup. In the initial stage, the board realised that the company funds are being mishandled or tampered with. This is why they decided to put Ashneer and Madhuri Grover and some other employees on a mandatory leave of absence. On further investigation and when other controversies surrounded the founders and a list of its other employees, the Board then wished to remove Ashneer and Madhuri from the company along with some other BharatPe executives. To this, Ashneer replied that he has done nothing wrong and the allegations that the board and the media posted were all wrong. “The allegations had no rhyme and no reason”, he reported.

    He admitted that the culprit in the issue is not himself and he further admitted that Suhail was the person who had to be expelled from the company. He said that Suhail was choosing the side of the board of directors to remove Grover as a key person in the company. Suhail deserves to be expelled from BharatPe. It was also brought to notice that Ashneer was the person who believed and entrusted Suhail in managing the company.

    According to Ashneer, he is being arm-twisted into leaving the company. Even then, he has no problem or issues in leaving the company but he wants the company to first payout his share.

    He said that if the company wants me to step out, then he wants his share of 4000 crores on the table. He thinks that his time is too important to be stuck somewhere in internal politics. He wants to focus on building more and he is not in the retirement stage. This finally led to Ashneer Grover resigning BharatPe on February 28, 2022.

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    Why is BharatPe Under Scrutiny of RBI?

    One might think that the issue is around Ashneer Grover and the company. In some sense, one might think that the whole topic is Ashneer Grover Vs. the Board of BharatPe. It is not wrong but it is also not completely true. As the fight of words started between the company and Grover, a string of issues were ignited. The fire also ignited other issues surrounding the whole company, BharatPe.

    There were financial authorities asking for credibility in sources of revenue and accounting norms from the company. The company was being screened for corporate governance issues if any.

    The flight of issues was such that the RBI had to be involved. The Reserve Bank of India is examining the company to check any discrepancies. RBI is checking if any Corporate Governance rules were violated. If they discover anything fishy about some rules being violated, the company can get a big shock. Along with the awaked goodwill, the RBI can stop future mergers of BharatPe with any other entity.

    It was alleged that there existed some financial irregularities at the FinTech startup. The issues and allegations got unearthed very recently during the investigations by risk management authorities and other financial regulatory bodies. One of the most notable authorities in investigations is Alvarez and Marsal, a management and risk advisory firm. The firm had already declared that there were inconsistencies in billing in dealings with the vendors. Besides, Alvarez and Marsal also found that there were payments from the company to vendors whose identities are faked.  

    As per the latest update dated February 23, 2022, from the sources close to the matter, Ashneer Grover’s wife Madhuri Jain Grover, who headed the Controls of Bharatpe, has been fired on the grounds of financial misappropriation. The probe that was ongoing on behalf of the BharatPe Board stated that Madhuri had used the company funds to fund her personal travels, on skincare products, and to buy expensive electronics goods. Furthermore, the report also includes her alleged expenditure of the company money worth Rs 1 crore for her holiday travels.

    Ashneer Grover and Kotak Bank Controversy

    The ex-co-founder and managing director of BharatPe, Ashneer Grover stepped down from the daily operations in the company in January. This was followed by a voluntary turned mandatory leave of absence from the company until the end of March, which finally concluded in the resignation of Grover and a termination of his wife.


    This was the time when he sparked a lot of controversies. One of the controversies was even a legal spat between Grover and Uday Kotak (Kotak founder).

    The first time Grover started a controversy was the time when an audio file was leaked. Ashneer Grover was allegedly abusing a Kotak employee in the leaked audio file. That was the first instance when the cofounder at BhartPe sparked controversy and was quickly spotted on the headlines. Nothing has been proved yet but the news is out there reporting some blowing facts and figures. Grover however explained that all of that was fake.

    The audio call headlines got more air when a legal notice surfaced on the news. The notice was from Grovers to Kotak and was dated November 30. This event further made the issue visible to the general public.

    Both were seeking compensation claiming that Grovers decided to invest Rs 500 crores in Nykaa IPO through the bank’s IPO financing services. Grover claimed that the bank failed him in financing for the Nykaa IPO. Even then, he had no problem or issues in leaving the company but he first wanted the Board or somebody from the company to buy him out his share. The company at the present time stands at a valuation of $6 billion, as per Grover’s estimates. Ashneer says that he is happy to leave once he is paid his share of Rs 4000 crores. The board of directors is yet to reply to this statement. Moreover, Grover has hired three legal firms to be legally protected in these times. The cloud of allegations, which was hovering during the past couple of months was finally dissolved in the form of the resignation of Ashneer Grover, days after the termination of his wife by BharatPe Board.

    Grovers and the Allegations Against Them

    Investors at the FinTech firm BharatPe are not liking it with Grover and they are even mostly ready to give his payout to leave the company. As the issue moved further, Ashneer came to the sidelines and the company was in the front of headlines.

    There was a preliminary investigation that was done by some external experts in the matter and they highlighted not just one but two big issues associated with the finance technological company.

    The two allegedly fraudulent persons who are associated with the company are the Grovers – Ashneer Grover and Madhuri Grover (his wife) who made the cloud of allegations more strong. Madhuri, however, is linked in both the fraudulent issues found by investigators.

    The report was helmed by Alvarez and Marsal, a management and risk advisory firm. The report was dated 24 January 2022, and was submitted to the BharatPe board. The Mint reported on 30th January, that the board had arrived at a decision to end the services of Grover based on the preliminary report submitted by Alvarez and Marsal, even as it had commissioned a comprehensive report.

    Those two allegations that the company has pushed to Grovers were of financial wrongdoings. The two major grounds on which they were troubled were irregularities in retirement and other allegations were about non-existing vendors on the platform.

    An examination of just two of the vendors pegged the amount paid by BharatPe for undelivered services at close to ₹4 crores. Grovers still maintains silence over all the allegations that point to them. The Grovers and BharatPe have not responded yet to the mentioned allegations.

    Among all the headlines, Ashneer says that he is being arm-twisted into stepping down and he has done nothing wrong to the company and the society. He says that he is still the finest person to run the company. However, it is taken into notice that Ashneer has hired three legal firms to support him in a fight with the board of the company. He has hired Karanjawala, Ritin Rai and Meraki law to make himself legally prepared for any future proceedings.

    A&M’s report found out that there were about Rs 51 crores that were paid to 30 vendors who were really non-existent. These payments and transactions were caught by the directorate general of GDT Intelligence or DGGU. The company on top of that also did not contest the demand for service tax, instead, they paid about Rs 11 crores in dues.

    The primary investigation also found some irregularities in the workings of the company and the issue of non-existent vendors.

    They found that this entailed an overall expense related to the 30 vendors of approximately Rs 53.25 crores (under validation). The company reversed the claimed input credit of 9.54 crore rupees and paid a penalty of 1.54 crores rupees. A&M has also recommended to the board that these issues require a much deeper investigation and analysis as to why the company was dealing with ‘non-existent vendors’ in the first place.

    The top allegations that Ashneer Grover faced in the wake of 2022 are:

    • He was accused of using expletives against a Kotak Mahindra bank representative.
    • Grover allegedly was involved in turning the working culture of BharatPe toxic.
    • Both Grover and his wife, Madhuri Jain Grover, who was also the Head of Controls of BharatPe, participated in financial irregularities involving the funds of Bharatpe.  

    Ashneer Grover Lost an Arbitration He Filed Against the Probe

    As soon as the Board of BharatPe started its investigation against Ashneer Grover, the Co-founder and MD of BharatPe, decided to rage against the same along with cementing his profits if an exit happens by wielding his stakes in the company. After Grover went on a two-month leave of absence, as decided by the Board, he quickly planned to file an arbitration plea with the Singapore International Arbitration Centre (SIAC), where he claimed here that the investigation of BharatPe against him was illegal. However, after the procession of the events, all pretty much against him, Grover lost his arbitration plea, as per the reports dated February 27, 2022, where sources close to the matter stated that the emergency arbitrator (EA) commented that in no ground the governance review at the fintech firm can be stopped.

    According to the anonymous sources thorough with the matter, the emergency arbitrator (EA) has reportedly rejected all the five grounds via which Grover placed his appeal, thereby denying a single relief.

    Grover had first pleaded about the preliminary investigation being invalid before the arbitrator. This is because, according to him, it violated the shareholder agreement and the articles of association, which is why he pleaded that the company can conduct any such investigation in no authority.

    He was also of the opinion that all of the appointments for the independent audit of the internal processes and systems of the company were pleaded to be bad in law. Grover had further alleged that the members of the committee who will be reviewing the governance processes, including the CEO of BharatPe, Suhail Sameer, and the general counsel of the company, Sumeet Singh, are all biased Ashneer Grover also pleaded that the appointment of Suhail Sameer as a director should be suspended and that he should be “restrained from discharging any functions as director of the company”, in the plea, thereby seeking that no action should be taken against him. Grover further added in his plea that the company kept on with the review and assessment in spite of several representations/objections and this was not a transparent process that gave him any chance to present his case. However, all of these claims and his entire plea have been rejected recently by the EA because all the five grounds of relief that Grover gave, seemed to be unreliable. The emergency arbitrator reportedly mentioned that Bharatpe has acted according to the law and governance norms against Ashneer. Mr. Grover can now further challenge the order of the arbitrator before the Delhi High Court, as per sources.

    The Resignation of Ashneer Grover

    Ashneer Grover resigned from BharatPe and has also relinquished the posts of Co-founder and Managing Director of BharatPe on February 28, 2022, after he was recently notified of the rejection of his emergency plea by the Singapore International Arbitration Centre (SIAC) on all 5 grounds.

    Here is a timeline of events to help you have a glimpse of the whole controversy involving Ashneer Grover, BharatPe and Kotak Bank:

    Timeline Events
    January 5, 2022 Ashneer Grover’s audio clip with Kotak employee surfaced where he used profanities.
    January 6, 2022 Grover declared that the audio clip is fake.
    January 8, 2022 The audio clip was taken off from Twitter and SoundCloud and Ashneer Grover eventually deleted his tweet.
    January 9, 2022 Reports came to limelight where Ashneer and Madhuri allegedly sent legal notice to Kotak. The bank further decided to press charges on him and Madhuri.
    January 17, 2022 The emails exchanged between Ashneer Grover and Harshit Sehji, the MD of Sequoia Capital came into the limelight that dated back to August 2020. This purported that Grover is wanting to partially sell the shares in a secondary transaction
    January 19, 2022 Ashneer Grover goes on a voluntary leave of absence
    January 29, 2022 BharatPe board decided to onboard independent auditors to run a probe on the company’s practice under Ashneer Grover’s administration
    January 30, 2022 Grover hoped to see an amicable resolution but he still hired a law firm to protect him and his stakes in the company.
    February 4, 2022 The investigation conducted against the BharatPe co-founder, his wife and some other employees, linked Ashneer and Madhuri Grover with financial frauds. Ashneer Grover’s letter dated February 2, 2022, surfaced, which talked about the removal of Suhail Sameer from the Board.
    February 10, 2022 Madhuri Jain Grover questions the leak the initial findings that name her in the Alvarez and Marsal report, with a letter to A&M.
    February 11, 2022 CEO Suhail Sameer assures the BharatPe employees to trust the Board for the future proceedings.
    February 22, 2022 Ashneer Grover attacks Rajnish Kumar, the Chairman of the BharatPe board, seeking protection against any future actions as part of the settlement process.
    February 23, 2022 Ashneer Grover’s wife and the Head of Controls of BharatPe, Madhuri Jain Grover, was fired by the BharatPe Board due to misappropriation of funds, as per the independent audit led by Alvarez and Marsal.
    February 27, 2022 Ashneer Grover’s emergency arbitration plea against the governance probe was rejected by SIAC.
    February end According to the reports, the key investors of BharatPe had turned down the Ashneer Grover offer of selling his stakes in the company for over Rs 4,000 crore.
    February 28, 2022 Ashneer Grover resigned.

    Conclusion

    All these leaks here and there point to more and more issues in the bricks of this behemoth organisation. Further investigations are being carried out to get a more clear picture of the whole issue and the resulting consequences. Right now most reports have no rhythm and reason and investigations are continuing.

    FAQs

    Is Ashneer out of Shark Tank?

    Ashneer has confirmed that his deals are not affected by the controversies.

    Who is BharatPe CEO?

    Suhail Sameer is the current CEO of BharatPe.

    Is Ashneer Grover out of BharatPe?

    No, the fintech startup has denied any rumours regarding the termination of the company’s co-founder, Ashneer Grover.

  • How Credit Scores Plays an Important Role in the Fintech Industry?

    In the last 7 to 8 years, the fintech industry has experienced immense growth all over. A countless number of fintech startups have begun their journey in the last few years and have already put their name on the list of top fintech companies.

    As of 2020, the global market size value of the fintech industry is $110.57 billion. Fintech or financial technology is a form of technology that is challenging the traditional method of providing financial services to people.

    Now in the fintech industry, there is a thing called credit score, and everyone is dependent on them, including consumers, business ventures, and purchasers. In this article, we will learn how credit scores play an important role in the fintech industry. So without any further, let’s get into the business.

    “The major winners will be financial services companies that embrace technology.” – Alexander Peh

    What Is a Credit Score?
    Fintech Industry in India
    Role of Credit Scores in Fintech
    How Credit Score is Calculated?
    Why Credit Score is Important?
    How to Improve Credit Score?
    Benefits of High Credit Score

    What Is a Credit Score?

    In simple terms, a credit score is a number that decides your creditworthiness. The number is between 300 to 850. The more your number is the more is your creditworthiness. This score actually depicts your chances to pay off the money that you owe to the lender.

    This helps any kind of financial institution to understand if you are dependable enough to pay the loan if they lend you. If your credit score is high, then the chance of getting a loan and credit increases for you, if you want to buy something. If the score is lower then, the chances of getting a loan decrease.

    There are different credit bureaus that check your credit scores and make a report on it and send it to you. The reports are based on many factors. There are three top and popular bureaus that count the credit scores of people.

    There are there main international credit score bureaus that assess people’s credit score and they are:

    • Equifax
    • Experian
    • Transunion

    Fintech Industry in India

    The fintech industry in India has taken a huge turn in a few years, it has changed the way we used to enjoy financial services in the past. Currently, it wouldn’t be wrong to say that India is the hotspot for fintech startups.

    As of 2021, the market size is $31 billion and it is said to be the third-largest in the world. By the next five years, we are going to see 22% growth annually. The country has 1860 startups in the fintech industry, out of those 17 have already got the Unicorn status. In the last two years, massive numbers of people have adapted to digital payments systems for any kind of transaction, and it’s only going to increase.

    Role of Credit Scores in Fintech

    The first thing the financial institution will do after getting your, request for the loan, is to check your credit history. If your credit score is good enough, then it will provide you with the loan and apart from that, loads of rewards and benefits. It is very good support for the fintech companies who are lending money to the borrowers.

    How Credit Score is Calculated?

    The way of calculating credit scores varies from bureaus to bureaus. They have their own model that they use to get the result. There are five things that are taken into consideration during the evaluation process and they are:

    • 35% of your Payment History
    • 10% Credit mix
    • 10% of new Credit
    • 30% of your Credit utilization
    • 15% of Credit history length

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    Why Credit Score is Important?

    The credit scores help you in two ways and they are:

    • Your credit score lets you know where you are lacking, the complete report gives you an idea of how you can improve in that area to increase your score. The report consists of all the transactions that you have made.
    • Through a good credit score, you are eligible to get attractive offers on loans and credit cards. A credit score of 750 and above is the best to get good offers.

    How to Improve Credit Score?

    • Pay your debt before the due date every month.
    • Don’t ignore your overdue bills pay them as soon as possible.
    • Keep in mind the credit card you use and its type.
    • Don’t spend too much on your credit card. Be aware of your spending and try to cut the unwanted ones.

    Benefits of High Credit Score

    A high Credit score has several advantages, some of which are listed below.

    • When your credit score is higher, you are eligible in front of banks to get loans and credit cards at considerably lower interest rates. Plus there is a chance of a discount on the processing fee of a high loan amount.
    • Those who have higher credit scores have a lower risk rate of not paying their debts. It basically means the chances of your loans getting approved are higher.
    • You are eligible for a credit card that offers good rewards and other offers like cashback as well.
    • Your credit limit increases, if you’re worthy, then the creditors know that you will pay your debt on time, this increases their trust which in return increases the credit limit.
    • Attractive Car insurance and home insurance rates are offered to those with good credit scores.’
    • Less number of documents is needed by lenders from you.
    • Guarantors are not needed when you are taking a loan if you have a good credit score.

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    Conclusion

    Getting loans or credits can be quite a hassle but if you have a good credit score, then lenders won’t hesitate to lend you the money. Fintechs take the help of credit scores and realize who to lend money and who do not. The credit scores assure the fintech, about your credit risk and the money that they are about to lend,

    FAQ

    Why do financial institutions look at your credit scores?

    Financial institutions take the help of credit scores to determine what kind of borrower you will be and if you are creditworthy or not.

    Who uses credit scores?

    Credit scores are used by financial service givers, especially lenders.

    What is a good credit score?

    A credit score of 700 or above is a good one as achieving the perfect 850 is quite hard.

    What are the factors that affect credit score?

    Payment history, Amount owed, Credit history length, Credit mix, and New credit are the factors that affect credit score.

  • BharatPe Business model | How does BharatPe Make Money

    BharatPe became very popular after its launch in 2018 among businessmen as it solved a unique problem. BharatPe’s boost generally happened during the pandemic when no payment app was charging transaction fees below 1.5%. This was the time when BharatPe cashed in on the opportunity. They made transactions absolutely free.

    This is why a lot of business owners who had to do large transactions daily, shifted to BharatPe. Today, it has more than 7.5 million active users in its app. Apart from providing free transactions, it also has solved a number of other problems. There is also a lot more to see about the business model which has grown to such an extent in such a small time. So, without any further ado, let us talk about the BharatPe business model.

    About BharatPe
    Business Model of BharatPe
    How does BharatPe Make Money
    BharatPe Funding
    What is Unique about BharatPe
    How did BharatPe Scaled Quickly?

    About BharatPe

    BharatPe is a fintech company headquartered in Bangalore. This payment aggregator has enabled transactions without any kind of fees. It has leveraged UPI  to enable this. It is a QR-based payment aggregator by which you can do any kind of transaction using the app.

    BharatPe was founded by Ashneer Grover, Bhavik Koladiya, and Shashvat Nakrani. All of these founders have a great profile. Ashneer Grover and Shashvat Nakrani are alumni of IIT Delhi. Ashneer Grover is a resident of South Delhi and has also graduated from IIT Delhi. He has been working with startups for a pretty long time. Previously he was also the CFO of Grofers, the grocery e-commerce giant. Ashneer has also led the Corp Dev for Amex India.

    Bhavik Koladiya has decent knowledge and experience about Fintech in general. He is heading the product and technology of the company.

    Shashvat Nakrani is originally from Bhavnagar and is a student of IIT Delhi of 2015-2019. He has done his B-Tech in Textile engineering.

    Business Model of BharatPe

    BharatPe has a very unique business model and because of this, it has grown exponentially. The major growth of BharatPe happened during the pandemic. In this time, they devised a smart method to expand. They leveraged UPI to enable absolutely free transactions. BharatPe was providing this when its competitors were charging fees less than 1.5 %. This is why a lot of vendors started moving to BharatPe.

    Making transactions free encouraged more people to use the platform. It also kind of did indirect marketing of BharatPe. When the vendors came on this platform, they started exploring the platform in a great way. The platform has been designed as a one-stop solution for all kinds of payments. They have devised various kinds of products to cater to the people.

    The company has launched the Xtraincome card which is an easy transaction solution, very helpful for business owners. It also gives you a cashback of 1% whenever you do a transaction with it.

    BharatPe XtraIncome Card
    BharatPe XtraIncome Card

    These applications are actually solving the main pain points of the businessman. Apart from this, they have also introduced BharatSwipe which is an innovative card swapping system. Another product is called BharatPe digital gold.

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    How does BharatPe Make Money?

    BharatPe earns its revenue by providing macro to microloans to its business owner. A working professional or businessmen get loans very easily but small business owners face problems while applying for the loan as their CIBIL score is low.

    BharatPe tracks the person’s transaction using its various products like Xtremecards and evaluates their capability to return the loan. According to it, they provide microloans to small businessmen without much paperwork. They do not provide loans using the CIBIL score. This solution accurately serves the pain points of small businesses. This is the main source of revenue for the app.

    BharatPe Funding

    BharatPe has raised a total of $700 million. They have presently gone through 12 rounds of funding. Apart from that, the company has raised a debt of 100 crores. They have secured funding of $370 million from Tiger Global Management. Apart from that they also have acquired funding from Dragoneer group, Ribbit Capital, Coatue Management.

    What is Unique about BharatPe

    Recently BharatPe has upgraded itself by collaborating with NBFC which are allowed to launch a 12% club by the RBI. This will give them a lot of benefits as compared to its competitor’s who are having the same product. This is because now any customer can go ahead and invest and can get upto 12% interest. They can borrow upto 10 lakhs.

    Growth of BharatPe

    Since its inception in 2018, this company has shown rapid growth. Today BharatPe ranks 4th after Paytm, Google Pay, and PhonePe in terms of users. Apart from that, it was quick in releasing products which actually solved the problem of merchants and the public at large. Services like 0% fees on any transaction. Products like BharatSwipe and  Xtraincome card are unique innovations to solve customer problems. They have also come up with innovative gold loans schemes.

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    Conclusion

    BharatPe has an impressive business model. The whole business is working around solving various pain points of small businesses. Their products are reliable which has led to their word-of-mouth marketing initially. Today they have more than a million merchants using their platforms. BharatPe’s business model is a unique model and an entrepreneur can learn a lot from them.

    FAQs

    What does BharatPe do?

    BharatPe is designed as a fintech company to empower small merchants and kirana shop owners. The company brings QR codes for UPI payments, Bharat Swipe, and an array of fintech products, including small business financing and more.

    How many people use BharatPe?

    BharatPe serves 7.5 million+ merchants in more than 140 cities of India, as of January 2022.

    How does BharatPe make money?

    BharatPe earns revenue by providing loans to small business merchants. A major portion of the BharatPe revenue comes from its merchants and its lending products.

    Who created BharatPe?

    Ashneer Grover and Shashvat Nakrani founded BharatPe in 2018.

    Is BharatPe a government company?

    No, BharatPe is a private fintech company founded by Ashneer Grover and Shashvat Nakrani in 2018.

    Who is the CEO of BharatPe?

    The current CEO of BharatPe is Suhail Sameer.

  • Takeoff Success Story – Online Mutual Fund Distribution Platform for Non-Individual Investors

    Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by Takeoff.

    Investment is all about making your future a better place. It is for the financial security of their capital that one can enjoy in the future. When a person makes an investment, it is to ensure that they get to earn higher returns. Investing in mutual funds goal is not any different.

    Mutual funds are a form of investment if people are able to understand it clearly. Now, individuals are able to invest on their own in mutual funds. For non-individuals like businesses, trusts, and others, Takeoff has taken responsibility since 2020. It is India’s first online mutual fund distribution platform for non-individuals.

    StartupTalky brings all about Takeoff, the platform, its Startup Story, Founders and Team, Name, Tagline and Logo, Funding and Investors, Business Model and Revenue Model, Challenges, Competitors, Awards and Achievements, and more in the article ahead!

    Takeoff – Company Highlights

    Company Name Takeoff Fintech Pvt. Ltd.
    Headquarter Hyderabad, Andhra Pradesh, India
    Industry Financial Services
    Founded May 2020
    Founder Prasad R. Lendwe
    Employees 11-50
    Areas Served India
    Website www.takeoff.in/

    About Takeoff and How it Works?
    Takeoff – Industry
    Takeoff – Founders and Team
    Takeoff – Startup Story
    Takeoff – Mission and Vision
    Takeoff – Name, Tagline, and Logo
    Takeoff – Business and Revenue Model
    Takeoff – Challenges Faced
    Takeoff – Growth
    Takeoff – Advertisements and Social Media Campaigns
    Takeoff – Future Plans
    Takeoff – FAQ

    About Takeoff and How it Works?

    The service that Takeoff mainly provides is mutual fund distribution. The main USP is that the entire process is online and condensed from 30 days to 1 day. Companies can now have the luxury to choose from all the schemes from all the AMCs through an easy-to-access platform. They have 24×7 access and the support team is always just a call away.

    Takeoff also provides KYC services for non-individual clients like businesses, trusts, government bodies etc. Gone are the days when one has to send mountains of documents to the AMCs and has to suffer the two months of hassle while their KYC was being processed. The Takeoff team takes only minimal documents and gets the KYC processed within just 7-10 working days.

    Takeoff – Industry

    Takeoff operates in the financial services and mutual fund industry.

    Growth in mutual fund industry AUM:

    The mutual fund industry has witnessed a growth of 30.82% from 2020 to 2021 with Rs. 26.07 trillion AUM (Assets under Management) in 2020 to  Rs. 34.10 trillion AUM in 2021.

    Split of investor accounts:

    The total number of investor accounts of Takeoff as of March 21 was 9,78,65,529, from which  7,91,859 (0.81%) is Institutional investor accounts and  9,70,73,670 (99.19%) are Retail and HNI investor accounts.

    Split of industry assets:

    The Total industry assets of Takeoff as of June 21 is Rs. 34,10,403 crore, from which Retail investor assets is Rs. 18,33,568 crore and Institutional investor accounts are Rs. 15,76,835 crores.

    Takeoff – Founders and Team

    Prasad R. Lendwe - Founder of Takeoff
    Prasad R. Lendwe – Founder of Takeoff

    Takeoff is founded by Prasad R. Lendwe, an Electrical Engineer. He is an MBA droupout from Kalina University, Mumbai. Apart from being the founder of Takeoff, he runs a Finance based YouTube channel, Convey by Finnovationz as well and has more than 1.8 M Subscribers.

    The current size of the Takeoff team is 15-18 members. The work culture in Takeoff is very relaxed and informal. They believe in working hard and playing harder. It basically means, during office hours, one can find them hunched over their laptops. During lunch, however, the team can be found engaging in spirited table tennis tournaments and other games.

    Takeoff – Startup Story

    Before starting Takeoff, the company was focused on their Youtube channel Convey by FinnovationZ. Through this channel, they were able to spread financial awareness for the past 6 years.

    In Jan 2020, they decided to take some of their own advice and tried to invest on behalf of their company. There are some surplus in the current account and the fact that they are earning 0% interest on it bothered them a lot. After using platforms like Zerodha and Groww in the past, it was wrongly assumed that the process would be just as easy.

    It was only after the actual process started, they realised how difficult it is in reality. As there was no dedicated platform working towards the mutual fund investment needs of non-individualism, the idea of the formation of Takeoff first came into their mind.

    Takeoff – Mission and Vision

    Takeoff’s short-term vision is to spread awareness and encourage more non-individuals to begin their mutual fund investment journey. They intend on doing this by providing top-quality service and exploiting their first-mover advantage.

    Their long-term vision is to emerge as a complete investment solution for non-individuals and to become a one-stop destination for any kind of investment that companies and other non-individuals want to indulge in.

    The core belief is centred on the fact that non-individuals, whether its companies, trusts, proprietors, or any of the others, deserve the same facilities and the same ease that individuals do. In the past few years, thousands of platforms have cropped up for retail investors, but companies have, sadly, been left out. It is Takeoff intention to right this wrong and fixes the imbalance.

    Takeoff logo

    Takeoff Fintech Pvt. Ltd. is the officially registered name of the company.

    The company doesn’t have an active tagline yet.

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    Takeoff – Business and Revenue Model

    Takeoff is working on a distribution model. The platform is currently free to use for all of their clients and it will always be free to use. Any non-individual can register and open accounts in Takeoff. No amount is charged from the clients. The revenue comes from the AMC (Asset management company). A fixed brokerage amount is paid for each AMC.

    Takeoff – Challenges Faced

    The lack of awareness among the non-individuals in India that they too can invest in mutual funds on behalf of their organization is the most challenging part of Takeoff. The conversion is not easy from a lead to an active investor, as the company has to explain the whole product and the industry at the same time over a very short span of time to their clients.

    Takeoff – Growth

    The journey from 0 to 100 Clients

    The journey was of severe ups and downs, like a roller coaster. Takeoff got their first client in December 2020 on their beta version and after some infertile months, the platform started gaining recognition, through several marketing campaigns. Currently, they have over 550 registered users and the company is experiencing slow but steady growth, they believe in value over volume.

    Customer Retention

    Takeoff believes that the best customer retention can be achieved only through superior customer service. Investments are a fairly complicated process, even if one makes it seems as easy as possible, clients will still have doubts. It is very important to make the clients feel as though the company is with them at each step along the way, in case they encounter any kinds of difficulties. This process has helped Takeoff in retaining its clients.

    Takeoff – Advertisements and Social Media Campaigns

    Takeoff has tried various platforms and a plethora of campaigns to generate leads and convert them to active investors. LinkedIn ads and their own Convey YouTube channel have been proved a constant success for the company. The company is looking forward to more events and other activities so that they can reach out to the target audience and make the platform enriched with the soul vision of the company.

    Takeoff – Future Plans

    The company is doing quite well. It has started to make a name for itself and is experiencing a steady inflow of clients in future. Both their client base and the AUM have started to increase.

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    Takeoff – FAQ

    What is Takeoff?

    Takeoff is India’s first online mutual fund distribution platform for non-individuals. They help non-individuals like companies, government bodies etc to invest in mutual funds.

    Who is the founder of Takeoff?

    Takeoff is founded by Prasad R. Lendwe.

  • Ditto Sucess Story – Simplifying Insurance for Indian Consumers

    In the financial services sector, insurance is always an area that seems like quicksand for the people who lack proper knowledge. Besides, the insurance sector is one that has always been devoid of proper, credible advisors who would steer their clients to fortify their future. This is where the digital insurance advisory platforms are proven to be a huge boon. Ditto is one of the latest online insurance advisory platforms that was founded by the co-founders of Finshots in February 2021.

    Ditto Insurance has been headquartered in Bengaluru and has already raised Rs 4 crore from Zerodha in an initial funding round, the latter also picked up a majority stake in it. With Ditto, the founders hope to reiterate the success they gained with Finshots, which was launched in 2019 and already boasts of a subscription of over 5 lakh readers.

    So, let’s check out Ditto, its Founders and Team, Funding and Investors, Challenges, Future Plans, Products and Services, Name, Tagline and Logo, Startup Story, and more.

    Ditto – Company Highlights

    Startup Name Ditto
    Headquarters Bangalore
    Industry Fintech
    Founders Pawan Kumar Rai, Shrehith Karkera, Bhanu Harish Gurram and Lokesh Gurram
    Founded 2021
    Current CEO Pawan Kumar Rai

    About Ditto
    Ditto – Industry
    Ditto – Starting Up
    Ditto – Product and Services
    Ditto – Founders and Team
    Ditto – Name, Tagline, and Logo
    Ditto – Business Model and Revenue model
    Ditto – Challenges Faced
    Ditto – Funding
    Ditto – Recognition and Achievements
    Ditto – FAQ

    About Ditto

    Finshots (The parent company of Ditto Insurance) is a 3-minute daily newsletter giving readers insights about all things economics and finance. Their vision is to create financial literacy among Indians by simplifying finance and financial products.

    The core belief of Finshots is that financial literacy is like basic arithmetic every person should know. Everyone should understand what’s happening with the economy, or what’s going on behind a financial scam – but the news is often full of technical jargon, making it obscure to the layperson. Hence, their main aim is to simplify finance for everyone and give trustworthy information that people can rely on.

    Ditto – Industry

    Finshots caters to the Fintech industry. They don’t have a target market for Finshots. They want to build an inclusive community of people willing to learn and understand financial concepts. On the other hand, for Ditto, their target market is the working population looking for insurance for themselves and their loved ones.

    Finshots currently has a user base of over 700K readers, while Ditto has helped more than 10,000+ people with their insurance queries.

    The fintech industry has massive scope, since investments, as well as insurance penetration, is severely lacking in the country. Only close to 2-3% of Indians have invested in equities, and insurance penetration is a meagre 3%. So the scope for growth in the industry is immense.

    Ditto – Starting Up

    After completing their MBA course, Bhanu Gurram, Shrehith Karkera and Pawan Kumar Rai founded Finception in 2018. Lokesh Gurram, an IIT Delhi graduate, worked for Samsung in South Korea for two years before joining the venture.

    They saw that financial news from major media houses was loaded with industry-specific terminology, as though it wasn’t intended for the masses. And so, Finception delivered explanatory long-form stories for a year. The objective was clear: To simplify financial news for the masses.

    In 2019, a separate brand called Finshots came about when the team realized that audiences suffered from information overload.

    Finshots delivers only one news a day. Readers spend just three minutes each day but in a month, they would have read about 28 topics.

    Finshots doesn’t spend a dime on advertising. Finshots’s subscriber base has grown to 500,000 just by the word of mouth. While Finshots educates people about the financial markets, readers are still left asking which financial product is best-suited to their needs.

    Then they launched Ditto, the latest product under the Finshots brand aimed at simplifying insurance policies for people. This is one of the many ways Finshots intends to simplify financial products and financial planning for the masses.

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    Ditto – Product and Services

    Finshots is a financial newsletter that one can read in no longer than 3 minutes. They also have a podcast that covers the same content as their newsletter. Their product tries to resolve the problem of lack of financial literacy among people by offering information in plain, simple, lucid English, which is their USP.

    They started Finshots back in 2019 when they realised people wanted finance content simplified and this was a market gap they wanted to fill. They later launched Ditto Insurance, their latest venture which provides insurance advice. Ditto aims to help millennials make better financial decisions and they’ve started with insurance. They want to make a dent in the insurance industry by educating the masses so that people can compare policies, narrow down their choices per their requirements, avoid pitfalls and buy the policy best suited for them.

    Ditto – Founders and Team

    Ditto Founders
    Ditto Founders

    At IIMA, Bhanu, Shrehith Karkera and Pawan Kumar Rai were batchmates. At the time, Rai was working on a way to simplify stock markets for millennials. They say that millennials must be helped traversing these jargon minefields.

    The founders were also a part of IIM Ahmedabad’s IIMAvericks program which gave them a monthly stipend. Nevertheless, Karkera taught part-time classes at coaching institutes like T.I.M.E. and Career Launcher, so Finshots could hire more interns and grow.

    Shrehith handles most of Finshots content, while Bhanu & Pawan handle marketing and sales. Lokesh manages product and tech.

    Finshots have over 80 employees at present, working from home. But they try to create a work environment that makes everyone feel like they’re having fun in what they’re doing, rather than being crippled with piles of work. They also organise monthly activities to keep up team spirit.

    When it comes to hiring, they look more at the enthusiasm and work ethics an incoming employee brings to the team, rather than their background and resume.

    Ditto Logo
    Ditto Logo

    The idea of Finshots is ‘financial shots’ – think of it like coffee shots you take in the morning. That’s exactly how they want people to consume financial information, one shot at a time.

    “Our philosophy behind naming our insurance advisory as ‘Ditto’ is that we want to tell people what kind of policy we would buy if we were in their shoes. We want to tell them exactly what we would do, and they can then make a decision based on that. “

    Ditto – Business Model and Revenue model

    Finshots is completely free and they don’t intend to make any revenue off of it.

    “That’s part of the mission behind Finshots – we want to democratise financial information, offering our content for free is part of it. “

    Ditto, on the other hand, earns money through policy sales. They function as a distributor and help people with purchasing policies.

    Ditto – Challenges Faced

    The biggest challenge faced by Ditto was the fact that insurance is a push product. The industry practices include mis-selling policies and spam calling. The founders believe that a product like insurance has the power to make or break the financial strength of households and that’s why their approach towards insurance is to research, give the right advice, and simultaneously ensure peace of mind to families.

    On the other hand, the biggest challenge for Finshots was expanding the reach of the newsletter. It’s definitely not easy to make lakhs of people subscribe to and read your content on a regular basis. And there aren’t any viral marketing shortcuts here. So they mostly relied on good-old word of mouth marketing, social media and college partnerships. They sent college newsletters to students and got their first 1000 readers.

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    Ditto – Funding

    Date Stage Amount Investors Name
    Sep 2019 Seed Rs 4 Crore Rainmatter, Zerodha

    Ditto – FAQ

    What is Ditto by Finshots?

    Ditto functions as a distributor and helps people with purchasing insurance policies.

    Who are the founders of Ditto?

    Pawan Kumar Rai, Shrehith Karkera, Bhanu Harish Gurram and Lokesh Gurram are the founders of Ditto.

    How much funding has Ditto raised?

    Ditto Insurance has raised a total of Rs4 Crore funding from Zerodha in Dec 2021.

  • Success Story of Savart: Company That Helps You to Manage Your Investments

    Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by Savart.

    Everyone yearns to make money and get rich. But, you simply cannot become wealthy with that increased paycheck. It all boils down to wealth management. Dave Ramsey rightly says, “money moves from those who do not manage it to those who do.” Money management, however, is not so simple. It requires knowledge, observation, expertise, and patience.

    Savart, a fintech startup by Sankarsh Chanda, is here to simplify investment management for you. Savart combines computing accuracy with the best of human intelligence. Savart advises over 100 crore rupees in assets and works with clients from over 30 countries. (As of January 2020)

    This ensures easy, safe, and profitable investments through its award winning research methods. StartupTalky interviewed Savart CEO Sankarsh Chanda, who started the company when he was just 18!

    Savart – Company Highlights

    Startup name Savart
    Headquarters Hyderabad
    Founder Sankarsh Chanda
    Industry Investment Management
    Founded 2017
    Registered Entity Name Svobodha Infinity Pvt.Ltd
    Total Funding $644.9K

    Savart – About
    Savart – Industry Details
    Savart – Founder And Team
    Savart – The Idea And Launch
    Savart – Name,Tagline, And Logo
    Savart – Business Model And Revenue Model
    Savart – Customer Acquisition
    Savart – Funding
    Savart – Challenges
    Savart – Competitors
    Savart – Achievements
    Savart – Awards
    Savart – Partners
    Savart – Advisors And Mentors
    Savart – Future Plans
    Savart – FAQs

    Savart – About

    Savart is a wealth management platform that simplifies investing in mutual funds, stocks, and bonds both online and offline. Savart combines machine accuracy and human intelligence to help its customers invest in stocks and mutual funds wisely. The company has a research team that does paper-based analysis, meets the management of listed entities, talks to dealers, suppliers, and customers to find out the strength of the entities/firms and take investment decisions accordingly.

    Upon signing on its platform, Savart prompts the users to fill an EFG (Emotional Financial General) form. After the EFG analysis, Savart suggests suitable investment options for the user based on their needs and expectations. The user can also manually research and invest in instruments without any guidance. There is the option for users to choose investment goals and Savart then shows combinations of mutual fund, SIP, and STP plans for achieving these goals.

    Savart’s services include:

    • Suggesting investment portfolios based on one’s needs, goals, risk appetite, etc.
    • Facilitates subscription and redemption of units by transmitting user’s money and instructions to AMCs based on instructions given by the users.
    • Securing user’s personal and financial transactions related data.
    • Lets the users track their investments.
    • Facility to undertake ‘KYC’ requirements.

    One can also access Savart’s services through the Savart app. The app is available for both android and ios as well as on the web. The Savart app has several interesting features and has received positive reviews from customers. One such feature is ‘round-up’. Through this facility, Savart stacks up its customers’ savings with loose change from every transaction and on the accumulation of a certain amount, the savings are invested into ETFs.

    Savart strives to provide uncompromising advice and research to individuals and institutions irrespective of their quantum of investment. Savart envisions itself as an end-to-end investment services company that helps people realize their dreams & passion. Savart has its office in Hyderabad.

    Savart – Industry Details

    The asset management industry in India is one of the fastest growing segments in the world. Corporate investors AUM (Asset Under Management) stood at US$ 127.65 billion, while HNWIs (High Net Worth Individual) and retail investors reached US$ 99.05 billion and US$ 82.03 billion respectively in December 2018. India is among the top five countries in terms of HNWIs in the Asia-Pacific region.

    The wealth management industry is likely to grow at 10-15% in the next five years.

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    Savart – Founder And Team

    Sankarsh Chanda is the Founder and CEO of Savart.

    Founder & CEO, Savart
    Sankarsh Chanda – Founder & CEO, Savart

    Sankarsh founded Savart in 2017 when he was only 18 years old. He is a certified Research Analyst, investor, author and fund manager. Sankarsh’s book Financial Nirvana that he wrote when he was just seventeen, explains the art of investment and how to profitably manage one’s hard earned money.

    Other core members of the Savart team are:

    • Aditya Ranade (Chief Investment Officer): Aditya worked with companies like RBS & Morgan Stanley before joining Savart.
    • Sridhar Vetapalem (Chief Financial Expert): He has 15+ years of fund management expertise.
    • Taruni Chandrasekhar (CFO): Taruni is a Chartered Accountant and Chartered Financial Analyst.
    • Pavan Kumar Kotamurthy (Research Analyst –Head): He is a Registered Investment Adviser, Research Analyst, MFD & ED certified, and was with NISM before joining Savart.
    • Prakash Raju (Rural Operations Head): He has 20+ years of expertise in rural marketing.

    Savart – The Idea And Launch

    The ideation happened when Sankarsh was only 14 years old. He read an article on“value investing” by Benjamin Graham which stressed on the importance of picking stocks trading for less than their intrinsic value for a profit opportunity. Sankarsh found the idea of value investing interesting and wanted to experiment with it. He convinced his elder sister and started trading through her Demat account. It began with just Rs 2000 that he got as a scholarship and saw his bets pay off quickly. Sankarsh continued thoroughly studying market trends and the balance sheets of different companies to build on his knowledge.

    It was never an idea to startup or set up a company. It was a simple idea to give investment advice, build investment strategies and invest; over time, the idea of doing this at a scale and combining my philanthropic interests gave birth to Savart. – Savart founder, Sankarsh Chanda.

    Sankarsh started freelancing and drawing investment strategies for individual clients when he was just 16 years old. He was seventeen when the Savart founder published his first book, Financial Nirvana. Meanwhile, Sankarsh joined the B.Tech. course in Bennett University, Greater Noida.

    Ajay Batra, the Director of the Center of Innovation and Entrepreneurship at Bennett university gave Sankarsh the confidence to start his venture. Sankarsh invested the money he earned through various investments for launching Savart. He interviewed about 400 people from diverse economic backgrounds to understand customer requirements better before working on Savart.

    Savart stands for ‘The Art of Savings’.

    Savart Logo
    Savart Logo

    The reason we give importance to saving in our name is because it is the fundamental requirement before beginning to invest. And we believe it sounds good too. – Savart founder, Sankarsh Chanda.

    Savart’s tagline is ‘Dream Up.’ The tagline is a reflection of Savart’s commitment to helping people ‘live’ better dream bigger. Savart helps to make quick money in the share market. The company’s aim is to help people realize their dreams and passion. The current logo was finalized upon after some iterations and wasn’t a one-time outcome.

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    Savart – Business Model And Revenue Model

    Savart’s services range from financial planning to investment advice and goal planning. Savart follows a simple revenue model; for the services provided, customers are charged as per the following plans:

    • For Investments between zero to 4,00,000, the charges are Rs.1299/- per annum.
    • For Investments exceeding INR. 4,00,000 , the charge comprises 0.5%(upfront fee)+ 3% of pre-tax net profits(performance fee).

    The company charges 1-2% as commission for mutual fund investments.

    Savart – Customer Acquisition

    Savart’s initial set of customers came from the team’s families and business connects obtained through referrals. Constant communication with the clients, keeping them in the loop, regular feedback collection, and constant improvements to its online platforms are some of the measures Savart takes to retain customers and uphold client satisfaction.

    Savart – Funding

    Raising funds has been an enriching experience for the Savart team, as said my Sankarsh. On May 6, 2018, Savart raised $100K in funding. Savart raised seed funding of $544.9K in November, 2021.

    Date Stage Amount Investor
    May 2018 Pre-seed $100K Undisclosed
    November 2021 Seed $544.9K BEENEXT, Yatra Angel Network

    Savart – Challenges

    Investing in people and finding the right talent has been a pain-point. Savart has upskilled several individuals to get the maximum out of its team as well as to help its employees move up the progress ladder. Sankarsh mentions that like every other startup, Savart also has downtime and that’s when the team needs some extra motivation. The customer first mindset uplifts everyone in times of distress.

    During our meetings, we have an empty chair and assume our customer is there, watching us work. This makes sure that we don’t get distracted or demotivated. – Savart founder, Sankarsh Chanda.

    The company never fails to celebrate milestones, no matter how big or small. These include feature release, team member induction, and positive customer feedback among others. Reaching out to the masses and help them invest and make money is Sankarsh’s personal motivation booster.

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    Savart – Competitors

    There are many fintech startups that deal with stock, share and mutual funds investment. Some of the top competitors of Savart are:

    Savart seeks inspiration from different entities; it is inspired by companies like Zerodha in terms of reach and services, by the likes of Oaktree capital management in terms of their investment research and quality of the team. However, Savart differentiates itself from others through its deep-tech research, customer experience, and the niche customer segments it targets.

    Savart – Achievements

    Some significant achievements include:

    • Savart sold mutual funds worth Rs 3.5 crores and stocks worth Rs 2 crores within a month of launching its online platform.
    • The company is managing an AUM of around 100 crores.
    • Savart was featured as one of the most promising fintech startups in the world by Burnmark, London.

    Savart – Awards

    Savart has received the following awards:

    • SMC Startup pitch Award – Mumbai 2018
    • T20 Starpreneuer of the Year – Mumbai
    • Delhi – NCR TiECoN’s QGLUE Design Entrepreneur of the Year

    Savart – Partners

    Savart has partnered with Bombay Stock Exchange for mutual funds. It is also licensed as a Registered Investment Advisor by SEBI.

    Savart is not a broker. So, it has partnered with Upstox, a Mumbai based discount broking firm , for final transactions. Savart is looking forward to partnerships with some other digital brokers. The startup is also in touch with banking correspondents to enhance its offline presence.

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    Savart – Advisors And Mentors

    According to Sankarsh, a mentor is one who adds direction and motivation to the business, offers continuous constructive criticism, and helps build the right culture for the organization. Savart is being mentored by the following experts:

    Ajay Batra: Mentor and Business Adviser, Director Bennett Hatchery, ex-Citibank. It was Mr. Batra who gave Sankarsh the confidence and support to think of entrepreneurship, and is mentoring Savart since day one.
    Sandeep Kataria: Ex-Marketing Head, Voonik and CureFit.
    Hemkumar Vajjha: Chief Technology Adviser MD, Impetus Solutions.
    Venkat: Development Head – Tech, Impetus Solutions, 25+ years of tech expertise.

    Savart – Future Plans

    Savart is all set for expansion and growth. Savart’s major bucket list items for the future are:

    • Opening offline stores.
    • Installing automated investment machine. The machine will be set up as an offline kiosk and users will be able to make investments using a debit card or cheque.
    • Making the Savart platform available in languages like Hindi, Telugu, and Gujarati.

    Savart – FAQs

    Who is the CEO of Savart?

    Sankarsh Chanda is the Founder & CEO of Savart.

    How much is the Net worth of Savart?

    Savart net worth is 100 crore rupees in assets (As of January 2020).

    What is Savart?

    Savart is a wealth management platform that simplifies investing in mutual funds, stocks, and bonds both online and offline. Savart combines machine accuracy and human intelligence to help its customers invest in stocks and mutual funds wisely.

    Who is Sankarsh Chanda?

    Sankarsh Chanda is the Founder & CEO of Savart. He also launched Stardour – a SpaceTech company.

  • Success Story of MoneyTap – Making Instant Loans Just A Tap Away

    Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by MoneyTap.

    Don’t you think life would have been easier if you had a personal line of credit at your disposal? Who doesn’t want a hassle-free credit, where there are no formalities and paperwork? And the icing on the cake would be the money getting topped up in your account as you keep paying back the borrowed amount.

    You are wrong if you think this isn’t possible. MoneyTap, a Bangalore-based startup has made this dream a reality. The company claims to be India’s first app-based personal line of credit for consumers. MoneyTap is India’s first company that provides lifetime credit of up to Rs. 5 lakh instantly to its customers.

    MoneyTap – Company Highlights

    Startup Name MoneyTap
    Headquarters Bangalore
    Founders Bala Parthasarathy, Kunal Verma, and Anuj Kacker
    Sector Fintech
    Founded October 2015
    Parent organization MWYN Tech Private Limited

    MoneyTap – About
    MoneyTap – Industry Details
    MoneyTap – Founders
    MoneyTap – The Idea And Launch
    MoneyTap – Name And Logo
    MoneyTap – How it Works?
    MoneyTap – Business And Revenue Model
    MoneyTap – Customer Acquisition
    MoneyTap – Funding and Investors
    MoneyTap – Challenges
    MoneyTap – Competitors
    MoneyTap – Achievements
    MoneyTap – Awards And Recognition
    MoneyTap – Acquisitions and Mergers
    MoneyTap – Partners
    MoneyTap – Future Plans
    MoneyTap – FAQs

    MoneyTap – About

    MoneyTap App
    MoneyTap App

    Started by three serial entrepreneurs, Bala Parthasarathy, Kunal Verma, and Anuj Kacker, MoneyTap was incorporated in October 2015. It offers instant personal loans of up to Rs 5 Lakhs, with the entire KYC process happening through its mobile app. It is headquartered in Bangalore, India.

    The startup aims to deliver quick and flexible personal loans to individuals in partnership with banks – smoothly and efficiently.

    The MoneyTap app is a trustworthy and reliable one with many USPs. The app offers instant online loans through a 100% paperless process and doesn’t require a bank visit. Moreover, one has to pay interest only on the amount borrowed. A loan taken through their app is collateral-free and has flexible loan tenures of 2-36 months. MoneyTap is India’s first company that provides lifetime credit of up to Rs.5 lakh instantly to its customers.

    Getting loans from MoneyTap is super easy. Eligible candidates need to download the app and fill the KYC. After completion of the KYC formalities, the loan is approved and the customer is given a MoneyTap credit card that’s loaded with the sanctioned amount. This can be used as a credit card or for withdrawing from the MoneyTap account. Once the repayments are done and there isn’t further need for an account, one can easily close the account through their website or the app.

    To be Eligible for MoneyTap Loans, one needs to be between 23-55 years of age and should have a regular source of income. A person having as low as a minimum in-hand salary of Rs 15,000 per month can apply for loans on the platform.

    A Complete Guide on How to get Instant Loan from MoneyTap 

    MoneyTap – Industry Details

    With the significant increase in internet users, almost every solution is now available online. Like all other services, financial services have also become accessible through apps and online services. Many Fintech companies are cropping up in the Indian market.

    India is amongst the fastest-growing Fintech markets in the world. Of the 2,100+ FinTechs existing in India today, over 67% have been set up in the last 5 years. The Indian Fintech market is currently valued at $31 Bn and is expected to grow to $84 Bn by 2025, at a CAGR of 22%.

    The Fintech transaction value size is set to grow from US$ 66 Bn in 2019 to US$ 138 Bn in 2023, at a CAGR of 20%.

    The Indian government is also launching initiatives to develop Visakhapatnam (Vizag) as the ‘fintech valley’.

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    MoneyTap – Founders and Team

    MoneyTap was founded by Bala Parthasarathy, Kunal Varma, and Anuj Kacker, who are IIT and ISB alumni.

    Kunal Varma, Bala Parthasarathy, Anuj Kacker - Founders, MoneyTap
    Kunal Varma, Bala Parthasarathy, Anuj Kacker – Founders, MoneyTap

    MoneyTap CEO, Bala Parthasarathy is the co-founder of multiple startups in Silicon Valley, including Snapfish (sold to Hewlett Packard). He has contributed immensely to the growth of Snapfish by gathering 100M users and $300M in revenue. Bala also volunteered for UIDAI under Mr Nandan Nilekani in 2007. He started AngelPrime, an angel investment firm in 2011 (now Prime Venture Partners). While working with AngelPrime he helped shape companies like ZipDial (sold to Twitter), EZETap, Happay, etc.

    Kunal Varma is a serial entrepreneur, who founded Whimsia Custom Works, a company for customized merchandise, and Aspirare, which designs learning programs and assessment solutions for job seekers and college graduates. Kunal along with Anuj Kacker also co-founded Tapstart, a job discovery platform.

    Anuj Kacker is the COO of MoneyTap. Anuj has experience in diverse fields courtesy of working with established brands such as Airtel, Reliance, and JWT. He co-founded Tapstart which grew to 300K users and turned profitable within two years. Anuj exited Tapstart in 2015 to join MoneyTap.

    With a small office in Mumbai and the headquarters in Bengaluru, the MoneyTap workforce is comprised of 30 people, as per 2019 data.

    MoneyTap – The Idea And Launch

    MoneyTap Founder
    MoneyTap Founder

    MoneyTap was founded keeping in mind the needs of the middle class. The salaried class is often constrained by monetary issues when it comes to satisfying needs. These needs can be anything like medical needs, school fees, or house rent.

    The trio observed that just a minimal amount of credit could help the middle class take care of these needs easily. But extensive paperwork and formalities make people apprehensive about taking loans unless it’s a huge amount. Moreover, credit cards and personal loans are not very popular in India.

    Besides, the middle class also finds it humiliating to borrow money from family and friends. MoneyTap was the solution to this conflation of issues.

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    MoneyTap Logo
    MoneyTap Logo

    The name MoneyTap was chosen because the app allows users to get money simply at the tap of the finger.

    MoneyTap – How it Works?

    The MoneyTap app, launched in partnership with the RBL Bank and several NBFCs, issues collateral-free credit up to a limit of Rs 5 Lakhs. The founders added that consumers can borrow anywhere between Rs 3,000 and Rs 5 Lakhs from the app and choose from among several repayment options with regards to time ranging from 2 to 36 months. MoneyTap and RBL also launched the RBL MoneyTap credit card. The card can be used like any other credit card for making online and offline payments. Users can also transfer money from the MoneyTap app to their bank accounts directly.

    MoneyTap offers loans at an interest rate as low as 1.08% per month, and 13% to 18% per annum.

    Consumers have to pay a one-time setup fee of Rs 499 along with taxes which is payable to the banking partner directly for blocking the credit limit.

    We are trying to get the middle-income group to use our application. For us, the sweet spot is someone who earns in the salary bracket of Rs 40,000 – 50,000 monthly. However, we also don’t mind it being lower.

    The founders also add that the money gets replenished as soon the customers start paying their EMIs. For example, an amount of Rs 30,000 borrowed (out of the credit limit of Rs 5 Lakh) will get replenished as the person pays their instalments over time, thus becoming available for borrowing in the future. Further, the onboarding of customers happens through a chatbot interface wherein the system instantly connects to the banking system and the credit bureau to find out the credit history of the customer. The money then gets approved accordingly.

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    MoneyTap – Business And Revenue Model

    MoneyTap adheres to strong business fundamentals since money lending requires attention to detail. The way it makes money is through a revenue share with banking partners. Every time a customer gets approved for access to a credit line for a lifetime, a small fee of Rs 500 is charged. Once the customer spends some money for one year, the money is recovered. Also, the usual interest paid by the customer along with the processing fees that are charged every time a person borrows also increases profitability.

    MoneyTap is designed to be a product company running on the backbone of data science, technology, and product thinking. It is also focused on low-cost, tech-friendly solutions to pave the way towards increased revenue.

    MoneyTap – Customer Acquisition

    MoneyTap was successful in building a large customer base within a short period. Within eight months of its inception, the company acquired 300,000 registered users from 14 cities in India.

    MoneyTap acquires some of its customers organically. The company also markets its products through Google, social media, and content marketing.

    According to Bala, there are a billion consumers in the country, and MoneyTap serves only 1% of them. He considers that even doubling this figure to 2% is a huge win.

    MoneyTap – Funding and Investors

    Date Stage Amount Investor
    Jun 14, 2017 Series A $12.3 million Sequoia India, New Enterprise Associates, Prime Venture partners
    Jan 28, 2020 Series B $70 million Sequoia Capital India, RTP Global, Prime Venture Partners, Aquiline Technology Growth & MegaDelta Capital

    MoneyTap has raised $82.3 million in 2 rounds of funding to date. In the latest round, MoneyTap raised funding worth $70 Million (500 Crore) in January 2020. Here are the funding and investor details of MoneyTap.

    The funding, as stated by Bala, has strengthened the leadership position of the consumer lending firm by improving credit accessibility for other customer segments.

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    MoneyTap – Challenges

    The most challenging thing in the consumer lending business is acquiring capital at low costs.

    Some of the major challenges faced by MoneyTap are:

    • Identifying trustworthy borrowers to whom credit can be disbursed without the fear of default.
    • Maintaining strong relations with banks and NBFCs.

    MoneyTap – Competitors

    Finomena is MoneyTap’s #1 competitor. Finomena was founded in 2015 in New Delhi. Like MoneyTap, Finomena also operates in the consumer finance space.

    Other major rivals of MoneyTap are, PaySense and ZestMoney. Both of these companies, founded in 2015, function in the same segment. While PaySense is located in Mumbai, ZestMoney is located in Bangalore.

    Besides, CreditVidya and Delhi-based Revfin also competes with MoneyTap.

    MoneyTap – Achievements

    MoneyTap has more than 5 Million downloads. However, this number isn’t indicative of customers who hold a credit line, since the rejection rate from the pool of applicants can be as high as 60-70 per cent. This high rejection rate is due to the rigorous checks done by the app’s algorithms.

    Almost 90 per cent of MoneyTap’s customers who have been issued credit lines are active and have drawn credit multiple times through the app. The average lending size of the company is Rs 30,000–35,000 and the average age of the customer is 28–30 years.

    MoneyTap is currently operational in 60 Indian cities, with the majority of its users coming from the top metros like Delhi-NCR, Bengaluru, Mumbai, and Chennai. The company is planning to expand its footprints to 200 cities soon. MoneyTap also claims to have its non-performing assets well within the one per cent mark.

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    MoneyTap – Awards And Recognitions

    MoneyTap was awarded the ‘Best Innovative Lending Product/Service’ in the Payment & Fintech category at the 8th India Digital Awards. The award show was organized by the Internet and Mobile Association of India (IAMAI). MoneyTap was also awarded the leading FinTech Company in the lending category at PICUP Fintech 2017.

    MoneyTap – Acquisitions And Mergers

    MoneyTap is not actively looking for acquisitions. Bala tells that MoneyTap might acquire companies sharing similar values.

    MoneyTap – Partners

    MoneyTap launched its product with RBL Bank, its first banking partner. With the help of RBL’s Technology, MoneyTap was able to serve customers with quick decisions and quick access to the money round the clock. Moreover, RBL Bank also provides a MoneyTap-RBL Credit Card with the credit line.

    In 2017, MoneyTap announced a partnership with Aditya Birla Finance Limited (ABFL). MoneyTap also has several other banks and NBFCs as partners.

    In December 2020, MoneyTap announced its partnership with Pawtect with a view to offering Pet Insurance Policies to their employees.

    MoneyTap – Future Plans

    MoneyTap’s plans include:

    • It is looking to expand to more Tier II and III cities in India, and to global markets with South East Asia and the Middle East.
    • The company currently claims to have a loan book of 1000 crores and aims to make it 5000 crores by 2021.
    • Expanding services to 200 cities in India.
    • Building partnerships with more banks.
    • The company currently targets customers in the age group 29-31, with average incomes of INR 30,000-INR 40,000 per month, but is planning to reach out to groups having income as low as Rs 10000-15000 soon.
    • MoneyTap has also received an NBFC license in September 2019 and plans to launch its own NBFC company soon.

    MoneyTap – FAQs

    What is MoneyTap?

    MoneyTap is a Fintech company that aims to deliver quick and flexible personal loans to individuals.

    Who are the Founders of MoneyTap?

    MoneyTap was founded by Bala Parthasarathy, Kunal Varma, and Anuj Kacker in 2015.

    How much is MoneyTap Funding?

    MoneyTap has raised $82.3 million in 2 rounds of funding. In the latest round, MoneyTap raised funding worth $70 Million (500 Crore) in January 2020.

    Who are the investors of MoneyTap?

    MoneyTap Investors includes:

    • Sequoia Capital India
    • RTP Global
    • Prime Venture Partners
    • Aquiline Technology Growth
    • MegaDelta Capital
    • New Enterprise Associates

    Who are the top competitors of MoneyTap?

    Some of the top competitors of MoneyTap are:

    • Finomena
    • PaySense
    • ZestMoney
    • CreditVidya
    • Revfin

  • How Did Revolut Turn 70 Employees Into Millionaires? [Case Study]

    Revolut is a UK-based Fintech company that provides banking services to its client. The company was founded in 2015 by Nikolay Storonsky and Vlad Yatsenko. The services they provide include currency exchange, credit card, and debit cards. With time the evaluation of this company has grown manifold. It has benefitted its shareholders immensely. But not only that it has managed to make 70 of its employee into a millionaire. So, let’s look at how Revolut turned 70 employees into millionaires.

    About Revolut
    How Did Revolut Help 70 Employees Turn Into Millionaires?
    The Revolut Share Sale Controversy
    FAQs

    About Revolut

    Revolut Founders
    Revolut Founders

    Revolut is a fintech company based in London, founded by two Russian entrepreneurs Nikolay Storonsky and Vlad Yatsenko. This company provides various banking financial services to its customers. The prominent services they provide are debit cards, credit cards, and virtual cards. They have also started providing services in free stock trading, crypto, etc.

    Recently it has started expanding in Japan in the year 2020. In the same year, they increased their employees from 1500 to 5000. It is now one of the most valuable companies in Britain. Today it is the fastest-growing fintech startup.

    How Did Revolut Help 70 Employees Turn Into Millionaires?

    Revolut has been giving services of credit cards, debit cards, and many other banking services. With time, it has grown more and more. It also provides quality services.

    Being a fintech company with smart products, it has successfully acquired the whole market. In due course of time, they have provided profit to their shareholders and also provided ESOP to their employees.

    Implemented Shrewd Business Model

    They grew quickly within a single year. As many as 10,000 users registered with them. Till now because of their shrewd business method they have made 70 of their employees into millionaires. In the initial days, the company had given its employees a good percentage of ESOP. This was done to encourage them to work harder and they too would become rich with the company.

    Issued ESOP To Its Employees

    With time, the company grew and it not only paid its actual shareholders but also made its employees rich as well. A lot of new employees also joined and have also opted for ESOP. This is why there might be more employees who turn out to be millionaires.

    But all these things are on paper only. It is not so easy to sell these shares. Revolut is not yet listed on any stock exchange. This is why it is not so easy to monetize them.

    At present, the company is allowing its employees to only take out parts of their shares. In reality, the employees have to sell their shares at a discounted price. But even in this case, it is making them rich.

    The Revolut Share Sale Controversy

    Revolut has issued shares to its employees when they joined the company. Now when the company has grown, the company has allowed their employees to sell some amount of their shares.

    To be specific, they have allowed their employees to sell 20% of their shares and allowed their former employees to dilute 10% of their shares. But it is not as simple as it looks. To monetize their shares, they need the help of a special agent.

    They also have to sell their shares at a discounted price than the original one. If they want to take the help of an agent, then fees will also be charged from them. This is why they have to pay extra money to sell their shares. This is causing a lot of discontentment among its employees. Many of the employees complained that the shares were not getting sold. Others complained about the discounted price.

    But in reality, these things are completely justifiable. First of all, it is a big luxury for people to sell shares of a new company. This is why it is completely fine to do it this way. Though they have to sell their shares at a discounted price the amount of money they’ll receive is huge.

    In the year, 2020 when the company was facing some slowdown due to the pandemic, they fired many employees. It was said that Revolut forced their employees to either resign on their own or they would fire them.

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    Conclusion

    This was the case study on how Revolut helped 70 employees turn into millionaires. If you are an entrepreneur, you can implement these learnings in your startups as well. Hope these learnings will help you grow your startup to new heights.

    FAQs

    What is Revolut?

    Revolut is a fintech company that provides various banking financial services to its customers. The prominent services they provide are debit cards, credit cards, and virtual cards. They have also started providing services in free stock trading, crypto, etc.

    How many employees does Revolut have?

    Revolut currently has a workforce of over 3000 employees.

    How Did Revolut Turn 70 Employees Into Millionaires?

    Revolut made over 70 employees into millionaires by implementing a shrewd business model in the organization. They also had an entrepreneurial culture that made their employees strive to be millionaires and work hard. They also gave their employees ESOP that they turned into millionaires.

  • Why did Paytm IPO Flop on its Market Debut?

    The intrinsic need of every human is to live a comfortable life. Leading a comfortable life is not easy if you don’t have some resources. It is important to note here that peace and comfort are not googleable. You need to do something to make your life a smooth sail. So that you have enough resources.

    Speaking of resources, one of the most important resources is money. It is a battery for storing value. The more you have it, the more free you will(feel) be. And mark my words, “freedom” is the ultimate flex.

    So to amass more of it, we people do many sorts of things. Some do business and others work for other businesses. If you look into the recent past you will notice how ‘investing’ as a domain has risen many folds. How people all over the internet are making portfolios. How stock market participants are rising. How everyone is hoping to get that IPO allotment. All these are examples of people trying to create some more income. Income leads to freedom. Not to mention how the “financial freedom” phrase gained momentum recently.

    Getting into stock markets has been a fad for more than a year now. Chasing IPOs is another fad for some young investors. There is an intrinsic trait of IPOs that interests everyone. The hype of listing gains. Quick profits and the first come badge. A recent hot chase was the huge Paytm IPO. Which didn’t go well. This is the article about that failure and the behemoth PayTM. Read on to see through.

    Indian Fintech Revolution
    A Brief about Paytm
    Financial State of Paytm
    Paytm Initial Public Offering (IPO)
    Paytm Listing Losses
    Paytm IPO Reviews
    Anticipated Reasons for the Downfall of Paytm IPO
    What should you do if you have bought Paytm’s Share?
    FAQ

    Indian Fintech Revolution

    Have you heard this term before? Fin-tech is a word derived from amalgamation of finance and technology. This could be named as the word of the decade. You won’t ask the reason for this, because you probably know it already.

    As the technology sector is rising, lines between companies are blurring. So much so that I would say that every company is a technological company now. With gaps blurring between sectors, the financial sector is the next most diffusing sector. It is hugely automated and also supported by countries’ governments. For example, in India the government is promoting digital payments after the demonetisation. This is a good boost for online digital payments companies, UPI (unified payments methods) and the like.‌‌

    A Brief about Paytm

    Paytm is a name that needs no introduction. The name is just enough. It is a leading digital payments company that is digitalizing India. Not to mention the immense support that the company is being provided by the government. Not only this, Paytm started the digital revolution in India.

    From that, they became the leading payments app in the second most populous country in the world. Today, to the north of the 20 Million mark, merchants & businesses are powered by Paytm to Accept Payments digitally. This is because more than 300 million Indians use Paytm to pay at daily stores. That’s not all, the Paytm app is used to pay bills, Send money, do Recharges to friends & family, Travel tickets & Book movies.

    The goal as the company mentions is to get unregulated businesses in the economy to the mainstream economy. Taking most of all the transactions happening in the country and enabling them digitally is an almost impossible thought. This is such a behemoth task but the digital payments provider is not looking backwards.‌‌

    It recently was listed in the stock market. It was a huge IPO. Investors all around the world were excited. It is now the biggest IPO ever in the history of the stock market in India. Previously it was Coal India which raised about 15,000 crores. Paytm is now listing to raise 18,000 crores rupees. ‌‌

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    Financial State of Paytm

    Paytm has been a loss making startup for a long time now. It is not earning at all. The startup has losses of about 4000 crore in FY 2019. That went to 3000 in FY 2020 and then to 7000 crore.

    Even though the losses are declining, this doesn’t hide the fact that the company is not earning at all. So why is that? Why a loss making company is valued so much. It is valued at over 16 billion dollars. Moreover it is able to raise money from big VCs. Asset management companies are pumping money into this loss making startup. ‌‌

    The reason why the company is left with such abundance of money is that it is a startup. An immensely successful startup. Which tries to get customers first, that is to capture a large market share.

    After getting a good chunk of the market, they will monetise themselves and earn ridiculous amounts of real cash. This is how most startups model work. They hack growth and become big organisations. They try to establish a strong company and reduce the time that is required to build a strong company.‌‌

    The startup has also already raised 8000 crores in its anchor round. Its initial public offering of Rs 18,300 crore. Top sovereign wealth funds around the world, financial investors such as Canada’s CPPIB, Singapore’s GIC, Alkeon Capital, BlackRock, Abu Dhabi Investment Authority are among those to have picked up stakes in this fintech.

    The parent organisation of Paytm is One97 communications. Other than recent fundraising rounds, One97 communications has shareholdings by top capitalists and Asset management companies. It has a 2.8 percent stake by Berkshire Hathaway, the company of world’s best known investor Warren Buffet. It has Ant group as a shareholder, that is as a subsidiary of Alibaba, founded by China’s richest man, Jack Ma.

    The promoter or the Chief executive officer of the company Vijay Shekhar Sharma has a stake of around 14 percent of the whole mammoth organisation. Other notable shareholders include Alibaba itself, Softbank, Elevation Capital. With all these big supporters this company recently filed for an IPO.

    The IPO was huge and reportedly the biggest that Indian markets have ever seen. Unfortunately, The public offering of Paytm fell down immediately after the listing. In fact today is the second day of the shares trading in the market. They went as low as 37% since the IPO.

    Let us discuss the whole public offering scenario in minute detail.‌

    Paytm Initial Public Offering (IPO)

    Initial public offering is the offering of shares to the general public. General public here means retail investors and big investors as well. When it happens for the first time, we call it the initial public offering. Accordingly it can happen second or third time also, in that case we will call it FPO or further public offering.

    IPO or any public offering happens when a company decides to take money from general people and not raise more rounds of funding. The money is needed to fuel growth. It is needed to scale the enterprise and thus the money becomes the new capital.‌‌

    In Paytm’s case, the company wanted to raise a little over 18,000 crores. This is the biggest amount ever raised in India. So the Paytm IPO is expected to be the biggest offering in Indian markets yet. The breakdown of the total money is that, 8000 something crores were new offering of shares. So, they were a fresh issue. And the remaining 10,000 crores were offered for sale, that is existing shareholders selling their share of stake. The price band of the shares ranged from 2080 to 2150 rupees per share. The valuation of the company at the time was about 1.5 lakh crores.

    The RHP is a legal prospectus for every new listing company. The red herring prospectus (RHP) of this company said that it expects to incur losses for more years before it starts making profits. The opening IPO date was 8th of November and the last date to apply was 10th of November. Face value of the share was One rupee. So it was going to be listed at a premium. ‌‌

    Paytm Share Price
    Paytm Share Price

    Paytm Listing Losses

    The Paytm IPO was subscribed only 1.89 times on Nov 10, 2021 17:00. The public issue subscribed 1.66 in the retail category, 2.79 in the QIB category, and 0.24 in the NII category. It shows that investors weren’t much interested in it or the IPO was so big that it just covers up all the demand.

    Paytm shares fell down by about 10.35% to Rs 1,402 against previous close of Rs 1,564.15 on BSE. Market cap of the company, which remained above the Rs 1 lakh crore mark on the listing day, faced down to about Rs 93,490 crore on the first listed day. This loss making startup is acting like a money guzzler.

    Paytm IPO Reviews

    Here are some reviews of the IPO from major and big fund coordinators and Asset management companies.

    International Brokerage firm Macquarie published a report on Monday. A second report on Paytm, maintaining its earlier target price of Rs 1,200 and an ‘underperform’ rating after its first one on listing day, ruffled the feathers of investors. This means that they concluded that the price of the share should be Rs1200 and the listed price is well overvalued.

    On the second day it went down to 40 percent. Exactly to the price what Macquarie anticipated but they released it after Paytm was listed on the stock market. ‌‌

    After the first day listing loss, investors panicked and tried selling this. This is a huge reminder that if you pick up a stock or an IPO to invest, do your own research. After an honest report only should you consider investing. ‌‌

    Mobikwik whose IPO was in the turn later in time also postponed their listing. Witnessing huge losses that investors incurred in Paytm’s IPO. Let us see some of the anticipated reasons that we all can see which led to the downfall of Paytm on the very first day of being listed.‌‌

    Anticipated Reasons for the Downfall of Paytm IPO

    Some of the most common seen and anticipated reasons for Paytm losing value are listed here. Let us figure out why this mega IPO is seen as a loser in the race for listing gains.‌‌

    Overall Market Conditions

    The current market conditions are also somewhat affecting the IPO listing. The current market trends show a downward trend. Today, you can see news of the market falling down 1170 marks. The day’s loss was the biggest for the index in over six months.

    This downward trend of Sensex is mainly due to Reliance sliding down 4.4% after it announced reviewing of a recent deal. Outside India and around the globe, inflation tension is rising and so are the Covid cases in Europe. All these activities have also in some sense affected Paytm’s downward trend. It is at about 37% down now from the listing day. ‌‌

    Paytm’s Financial Situation

    If you have invested in Paytm looking at the fundamentals then you know for a fact that Paytm is not going to make profit anytime soon the profitability game is slightly a long way ahead. We still don’t know when Paytm will become profitable.

    Another fact is that the newly listed companies right now are also trying to be very smart because they know that there’s heavy retail participation in the market. A lot of people like me and you will go for listing gains so Paytm came out and did a mega IPO which was 18,000 crores.‌‌

    Size of the IPO

    Listing gains comes when supply is short and the demand is quite big. In layman language, when the offering is small, listing gains are expected. In Paytm’s case, the IPO is so big that it covers the overall demand and it leaves no space left for a force to push the price up.

    The Paytm IPO was subscribed 1.89 times on Nov 10, 2021, 17:00. The public issue subscribed 1.66 in the retail category, 2.79 in the QIB category, and 0.24 in the NII category. So you see all the demand was covered with the hugeness of the IPO and less space was left to pump the price up.‌‌

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    What should you do if you have bought Paytm’s Share?

    If you are someone or you know someone who is stuck with this stock. I would suggest two options. First is to just get rid of this stock as quickly as possible. Second, if you are an investor with a long term horizon then you can consider holding this stock. But keep this in mind that this stock will take a good amount of time to go profitable.

    The reason is as we discussed earlier is that the company is making consistent losses for now. It also is forecasted that the company will only scale for now and it has no immediate plans to bring the profit perspective to the table.

    As of now, the company is down to 30-40% and it is going to take time to take back these percentages of losses, only then one can expect some profits. Again if you are looking for quick listing gains, then maybe this might not be the probable right stock and time to stay invested in this stock.

    For all the inventors who didn’t apply for this IPO this is the right moment to be aware of such scary situations. It is always best to research before you invest your money. It is really a scary situation when you invest in a big loss making startup, and you are stuck in it. Startups can be a blackhole for money for a very long time.‌‌

    Conclusion

    The reason for such a hype of this fintech company being listed is that, India is the second most populous country in the world. China, the top populous has already had their share of the fintech revolution. They are also harsh on regulations. Now it is India’s turn. India is the next hub for investors that may be domestic or foreign.

    Digital payments are expected to grow up to 5% in the next five years. Digital commerce will likely move up to 3.3%. With these things in store, India becomes the next hot spot for investments.

    Jio and digital revolution boosted the Paytm business. Demonetisation skyrocketed it. Their tagline “Paytm karo” became a household thing during these times. With the government promoting digital economy and cashless transactions, hope is high for fintech revolutionaries like Paytm.

    The listing losses taught many people to do their own research before investing anywhere. The company is expected to take a long time to jump to profits.

    Whether Paytm will change Indian payments face or it will dissolve, this is to be seen and only time will tell. One thing is for sure, it has massively added to the cashless economy that the world is striving towards.

    FAQ

    What is Paytm IPO?

    Paytm is a digital payment system, the company lunched its IPO in Bombay Stock Exchange with largest initial public offering (IPO) with the value of Rs 18,300 crores.

    Why did Paytm IPO flopped?

    Some of the common reasons why Paytm IPO flopped was Overall Market Conditions, Size of the IPO, and Paytm’s Financial Situation.

  • Yap – Transforming Every Business Into a Fintech

    Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by Yap.

    Technology has transformed the way financial transactions and operations happen. Today making and accepting payments, receiving loans, everything has become simpler than ever before. All thanks to tech startups, that are coming up with amazing products that have made financial operations much easier for financial institutions, business owners, and consumers. Chennai-based ‘Yap’ is one such startup that this revolutionizing the way banks and other financial institutions offer services to their customers. Yap provides tools that let banks and financial institutions design customized and convenient solutions for their customers. Here is more about Yap.

    Yap – Company Highlights

    Startup Name Yap
    Also Known As M2P Solutions
    Headquarters Chennai, Tamil Nadu, India
    Industry Fintech
    Founders Madhusudanan R, Prabhu R
    Founded Nov 14, 2014
    CEO Madhusudanan R.
    Website www.m2pfintech.com

    Yap – About
    Yap – Latest News
    Yap – Founders and Team
    Yap – Startup Story
    Yap – Mission and Vision
    Yap – Logo
    Yap – Business Model and Revenue Model
    Yap – Employees
    Yap – Funding and Investors
    Yap – Growth
    Yap – Competitors
    Yap – Future Plans
    Yap – FAQs

    Yap – About

    Yap offers a payments-as-a-service infrastructure that can handle all types of retail payment assets. Yap’s Application Programming Interface (API) platform allows digital platforms, fintech companies, and offline businesses to offer personalized solutions to their end customers, by linking them with other fintech platforms and banking and non-banking financial firms.

    Yap’s functional APIs, let its clients receive and transfer funds through  Wallet & Cards, Cross Border Payments, Gift Cards, Fleet Spends, Just-In-Time Funding, UPI as well as other payment methods. Consumer, corporate, small business, and credit card loans are among the products it offers.

    Yap’s modular platform ‘bank in a box’ enables its clients to offer products such as opening bank account, credit, online payment, toll payment, foreign exchange solutions, etc.

    Many companies in Nepal, India, New Zealand, the UAE, Australia, and the Philippines are served by YAP. Around 20 Indian banks, including ICICI Bank, Yes Bank, and RBL Bank, as well as numerous consumer internet companies like Ola, Cred, Swiggy, and also large NBFCs like Muthoot, TVS Credit, Bharat pe, Razorpay, Finin, etc use YAP’s services on the lending space.

    Yap – Latest News

    In March 2021, Yap raised $10 Million in funding from investors like Flourish Ventures and Omidyar Network India. The fundraising round included participation from YAP’s current investors, including Beenext, 8i Ventures, and Better Capital.

    “We are uniquely poised to cater to new cohorts of distributors as more firms embed financial services into their digital platforms. This investment allows us to strengthen our technology teams, build new capabilities as well as reach new markets across Asia,” Madhusudanan R, co-founder at Yap, said.

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    Yap – Founders and Team

    Yap was founded by Madhusudanan R and Prabhu R.

    Madhusudanan R

    Madhusudanan R is the Chief Executive Officer & Founder at YAP. He is a fintech entrepreneur with deep-rooted experience in building and scaling Payments businesses across Asia.

    Prabhu R

    Prabhu R is the Co-Founder & Chief Operating Officer at YAP.

    Yap – Startup Story

    Madhusudanan R. and Muthukumar A and came up with the Yap idea during the office tea breaks. The founders who worked at Visa Inc in Mumbai from 2010 to 2012, often realized how big banks were lagging behind in digitizing their services. The focus of these conversations was always on how the financial industry might fix this problem. Finally, Madhusudanan and Muthukumar, came up with a solution themselves and founded Yap in 2014.

    The Yap founders observed how banks work in India, through their combined expertise of over a decade working for Visa, Citibank, and Paypal. They understood that due to their aversion to developing new digital products, banks were unable to reach a whole new set of clients. Yap is a solution to these problems, Yap’s is empowering many banks, financial institutions, and businesses to offer various customized solutions to its customers.

    YAP’s unique API (application programming interface) gives banks and fintech businesses the tools they need to create new payment systems. This shortens the time it takes for these businesses to acquire consumers who want simple and quick electronic payment options.

    “When we started, banks in India didn’t use any APIs. In other markets, like the US, this phenomenon started ten years ago. In India, it started around 2014–15, when a few digital payment companies started to grow,” Madhusudanan, co-founder of YAP, told.

    The firm claims to deal with 15 banks in India at the moment. Apart from providing an API for payment integration, including UPI payments, YAP also assists them in acquiring corporate clients, which are often digital financial institutions such as neobanks or the fintech divisions of big corporations.

    “They don’t have to spend any money on this, and they can reach a lot larger audience without having to spend money on client acquisition,” Madhusudanan explained.

    Yap – Mission and Vision

    Yap’s mission statement says, “We are focused on user experience and customer retention. We are constantly thinking of new use cases and ways to serve our customers across all their financial needs as seamlessly woven into their daily routine life as possible.”

    YAP is on a mission to transform every business into a fintech.

    Company Logo of Yap
    Company Logo of Yap

    Yap – Business Model and Revenue Model

    Yap provides B2B tech solutions to financial institutions and businesses. The YAP platform connects companies to licensed banks, financial institutions, and financial infrastructure such as UPI/card networks through its extensive Application Programming Interface (API) libraries. Within a few weeks, a company may connect to YAP’s platform, choose goods and banking partners, and roll out financial products to its consumers or vendors. In addition, YAP oversees essential continuing activities like reconciliations and compliance monitoring. YAP now serves over 200 fintech with an API platform.

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    Yap – Employees

    • Rajesh Wadhwa – Chief Business Officer
    • Prabhu R – Co-Founder & Chief Operating Officer
    • Muthukumar A – Chief Technology Officer
    • Madhusudanan R – Chief Executive Officer & Founder

    Yap – Funding and Investors

    Date Round Amount Lead Investors
    Mar 16, 2021 Series B ₹732M Flourish Ventures, Omidyar Network India
    Apr 21, 2020 Series A $4.5M BEENEXT
    Feb 13, 2020 Seed Round ₹100M Amrish Rau

    Yap – Growth

    Around 20 Indian businesses, including ICICI Bank, Yes Bank, and RBL Bank, as well as numerous prominent consumer internet companies like Ola and PaisaBazaar, use the service.

    “We are uniquely poised to cater to new cohorts of distributors as more firms embed financial services into their digital platforms. This investment allows us to strengthen our technology teams, build new capabilities as well as reach new markets across Asia,” Madhusudanan said.

    The 6-year-old firm offers comprehensive Application Programming Interfaces (APIs) to banks, startups, and consumer online businesses. The new funds (raised in March 2021) will be utilized to expand into foreign markets and bolster the team with new hires.

    Yap – Competitors

    The top competitors of Yap are

    • Open Bank Project
    • Decentro
    • TrueLayer
    • Teller, Inc.
    • Plaid
    • Konsentus
    • Figo
    • Quovo
    • Instantor.

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    Yap – Future Plans

    Yap’s major plans include expansion to new geographies and expanding the team.  According to Madhusudanan R, co-founder of YAP, the company intends to grow to Bangladesh, Saudi Arabia, Oman, Egypt, Vietnam, and Indonesia.

    India’s rapidly digitizing financial environment, according to Amol Warange, head of Omidyar Network India, would provide chances for YAP to expand.

    “We think that digital enablers like YAP can catalyze financial inclusion and promote adoption of financial products among the next 500 million Indians who are projected to access the internet for the first time via their mobile phones” Warange added.

    Yap – FAQs

    What does Yap do?

    Yap offers a payments-as-a-service infrastructure that can handle all types of retail payment assets. The company’s platform links banks, financial institutions, enterprises, payment networks, and merchants to build an interoperable payment platform that allows businesses to quickly design and carry out their own customized payment solutions.

    Which country is Yap based in?

    Yap is a Chennai-based, Indian fintech company.

    Who founded Yap?

    Yap was founded by Madhusudanan R and Prabhu R.

    Which companies do Yap compete with?

    Open Bank Project, Decentro, TrueLayer, Teller, Inc., Plaid, Konsentus, Figo, Quovo, and Instantor are the top ten competitors of YAP.