The Economic Times daily newspaper is available online now.

    CredAvenue raises $90 million in India's biggest Series A funding round

    Synopsis

    CredAvenue has raised $90 million in a Series A funding round led by Sequoia Capital, at a valuation of $410 million. The funding will be used to expand the product suite and ramp up technology, CredAvenue founder Gaurav Kumar says.

    Gaurav-KumarETtech
    CredAvenue founder Gaurav Kumar
    Mumbai: CredAvenue has raised $90 million in a Series A funding round, led by Sequoia Capital and co-led by others such as Lightspeed Venture Partners, TVS Capital Funds and Lightrock India.

    The round values the enterprise debt marketplace at $410 million.

    Elevate Your Tech Prowess with High-Value Skill Courses

    Offering CollegeCourseWebsite
    MITMIT Technology Leadership and InnovationVisit
    IIM KozhikodeIIMK Advanced Data Science For ManagersVisit
    Indian School of BusinessISB Professional Certificate in Product ManagementVisit
    This is the largest ever Series A round in India, ahead of Ola Electric’s ($58 million in 2019) and Mensa Brands ($50 million in May 2021), according to data from Venture Intelligence. Other Indian startups that attracted large Series A rounds include FamPay ($38 million in June 2021), Design Café ($29 million in December 2018) and Cred ($25 million in September 2018), the data showed.

    “The valuation is extremely attractive for us... The reason why we went ahead has to do with the choice of partners. More than valuation, for the long term, these are partners we wanted to work with,” founder and CEO Gaurav Kumar told ET. “We are mission-focused as a team. If we get this right, it’ll be transformational for the ecosystem and the country.”

    CredAvenue also counts Cred and Stride Ventures as investors.

    The fintech startup will use the funds to expand its product suite and ramp up its technology and data science infrastructure, Kumar said. “The capital will go for building our product out as we envisage it; we’re not even a percent of where we want to be. It’ll be used for enhancing technology, data analytics, product, and platform capabilities,” he said.

    CredAvenue operates a platform that connects corporates seeking loans with financial institutions and other investors who can facilitate such debt offerings through various instruments.

    The year-old startup is not a non-banking financial company (NBFC), which means it does not lend on its own and merely facilitates these transactions for entities on its platform.

    “We’re an operating system for India’s debt capital market. We work with enterprises with AAA ratings and unrated businesses. The size of debt facilitated on our marketplace ranges from Rs 50 crore to Rs 3,000-Rs 4,000 crore,” Kumar said.

    The Chennai-based firm currently has over 1,500 corporates and more than 750 lenders facilitating loans worth over Rs 72,000 crore, he said. It now aims to grow two-fold over the next year and plans to onboard more corporates and lenders. The startup currently facilitates six kinds of loan transactions—large working capital term loans, loan originations, corporate bonds, securitisation, co-lending and trade financing.

    According to Sakshi Chopra, managing director at Sequoia India, the range of offerings and corporates on CredAvenue can help deepen India’s debt market.

    “CredAvenue is a unique solution that not only simplifies access to credit for borrowers ranging from a BB to AA rating but also improves access to multiple debt products like bonds, supply chain financing, etc., on a single, unified platform,” she said. “We believe it has the opportunity to become the platform of choice for borrowers and lenders operating in the debt market.”

    Avendus Capital advised CredAvenue on this transaction.
    The Economic Times

    Stories you might be interested in