Exclusive: Dot in talks to raise $25 Mn from PayU

Commerce and payments enabler for brick and mortar businesses Dot is in advanced talks with Prosus-owned payment gateway PayU to raise a $20-25 million in a fresh investment round, said three people aware with the details of the transaction.

“The conversations have reached a late-stage and the contours of the deals have been finalized,” said one of the persons on condition of anonymity. “Dot is also in talks with DST Global to raise another $25 million.” However, conversation with DST is still in early stages and may not even go through, added the second person.

Sources emphasized that PayU will value Dot in a range of $75 million. “If the size of the round crosses $50 million, Dot’s valuation will go up to $120-125 million,” added the above-quoted person. These fresh proceeds come almost a year after their last round.

In February last year, the company raised $7.8 million at a valuation of $20 million led by PayU Fintech Investments and Ruizheng Investments. InfoEdge Ventures, angel investors Kunal Bahl, Rohit Bansal, Amrish Rau, Vikrant Batra, Sachin Singhal, and Rekha Jain also participated in the Series A round.

Floated by PayU’s co-founder Shailaz Nag along with Gyanesh Sharma, and Anurag Gupta back in May 2019, Dot provides digital transformation and commerce solutions to offline outlets along with extensive customer engagement tools to these stores.

Entrackr queries sent to Nag on Monday didn’t elicit any response while PayU declined to offer any comment on the story. Queries sent to DST Global remained unanswered until the publication. We will update the story as and when we receive responses.

Over the past six to eight months, there has been a lot of action in enabling digital channels and payments to brick and mortar shops. In September, Dot had launched Digital Showroom (previously Digital Dukaan) to enable a digital storefront for small merchants. 

Lightspeed-backed OKCredit and B Capital-backed Khatabook launched separate apps that enable instant digital stores. Hyderabad-based Bikayi also raised funds from a clutch of international investors while Bengaluru-based Dukaan scooped up $6 million from Lightspeed and Matrix.