Mutual fund and stockbroking app Groww has received Rs 49.9 crore in an equity funding round from its parent entity, Billion Brains Garage Ventures Private Limited. The tranche seems to be a part of its $21.4 million worth Series B round led by Ribbit Capital.
According to regulatory filings, the Bengaluru-based company has allotted 2.5 lakh compulsorily convertible preference shares (CCPS) at an issue price of Rs 1,986 per share to raise the total consideration of Rs 49.9 crore. The fresh tranche would be utilized towards fueling its expansion and business operations.
Backed by Y Combinator, Sequoia Capital, Propel Venture Partners, Kauffman Fellows, the three-year-old Groww has raked in around $36.22 million total capital across four financing rounds.
Groww essentially helps amateur investors to make investments in special investment plans (SIPs) such as mutual funds. It recently began stock trading, expanding its horizon beyond mutual funds and gold. With a majority of its users in the age bracket of 20-40, the app claims to have over a million registered members.
With the stock trading feature launched, Groww would compete with Zerodha, one of the largest stockbrokers. Groww had said it has been testing stockbroking feature for about five months and about 1 lakh investors have already opened their account through invitation. As of now, users had performed 2 million transactions.
Ever since the beginning of the pandemic and lockdown, mutual funds and stock markets have been seeing a downturn. Online applications such as Groww, ETMoney, Scripbox, IndWealth, Paytm Money, Kuvera, and Piggy are recording less business as the mood around overall investments isn’t encouraging.