Exclusive: BharatPe raises $75 Mn led by Coatue and Ribbit Capital

The payments space has become overcrowded in India with several well-funded companies battling it out leaving very little room for new entrepreneurs. However, BharatPe has managed to carve its own path. 

The one-and-a-half-year-old startup has scaled quickly and raised a $50 million worth Series B round in August last year. Now, it has raised more capital. Private equity firm Coatue has led a $75 million (Rs 535 crore) Series C round in the Delhi-based firm along with existing investor Ribbit Capital.

According to regulatory filings, the company has approved to allot 6,917 Series C1 shares and one equity share at a price of Rs 7,73,430 per share to five investors.

While Ribbit Cayman and Coatue PE invested Rs 178.33 crore each, Amplo  Opportunities invested Rs 89.17 crore. Grace Software Holdings and Steadview put in Rs 60.6 crore and Rs 28.5 crore respectively.

Besides Coatue, Amplo is the other new investor in BharatPe. This looks like the maiden investment for a little over two-year-old venture capital firm founded by 28-year-old Sheel Tyle. The Texas-based VC firm Amplo is estimated to have raised over $100 million to bet on seed and growth-stage companies.

Post the investment, new backers Coatue PE and Amplo Opportunities will hold 5.88% and 2.94% respectively in the Ashneer Grover-led company while the promoter’s stake will be reduced to 22.96%

Steadview Capital, Grace Software Holdings and Ribbit capital had also participated in the previous round and will control 4.57%, 11.01% and 11.42% stake respectively in BharatPe on a fully diluted basis.

Notably, early backer Sequoia has stayed away from this round. They had invested around $12 million in the company last year. 

Economic Times had first reported about BharatPe’s engagement with Coatue and others for a $100 million round. The round could be an ongoing one and more capital may flow to the company’s coffers.

BharatPe is a QR code-based payment app that enables offline merchants to accept digital payments through any third party UPI apps. In August last year, the firm claimed to cross $18 million transaction volume mark on a monthly basis.

Entrackr’s back of the envelope estimate shows that BharatPe has been valued at over $410 million in the fresh financing round.

With the waiving off of MDR and PSP fees, UPI-centered consumer and business-facing apps are left with no scope of making money on merchant transactions. BharatPe is also impacted because of zero-fee on both fronts.

But the firm has different plans to make money. It sees lending as a big opportunity as small retailers are not serviced well by banks and the traditional lenders. On top of it, it’s also gearing itself for new-age banking services. 

According to Entrackr’s sources, BharatPe is eyeing to add a neo-banking component in its business plan as well. The quick growth of the company has positioned it as the fourth-largest player in the UPI segment after Google Pay, PhonePe and Paytm. And that too without spending much money.

Post this round, BharatPe is expected to turn more aggressive when it comes to chasing growth and scale. A significant chunk of this amount may go into the lending business as well.

In an environment of quick evolving regulatory norms and emerging challenges in the payments business space, BharatPe now has the firepower to take on the leaders. This space is now gearing up to see more action.