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Tag: TPG

  • Powered by India’s small businesses, UK fintech Tide becomes a TPG-backed unicorn | TechCrunch

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    U.K.-based fintech Tide has entered the unicorn club with a fresh funding of $120 million led by TPG, as the startup now serves over 1.6 million micro and small enterprises globally — with more than half of them based in India, the company’s largest and fastest-growing market.

    The new round — a mix of primary and secondary investment, though the startup declined to confirm the exact split — values the eight-year-old startup at $1.5 billion. It includes share sales by employees, early angels, and a few minority investors. TPG backed the round through its multi-sector impact vehicle, The Rise Fund, which has invested in over 85 mission-driven companies. Existing investor, the Apax Digital Funds, also participated.

    Globally, micro and small enterprises, including contractors, freelancers, and solopreneurs, spend a significant amount of time on business management tasks like accounting, invoicing, taxes, securing loans, and managing payments and expenses. While traditional banks and fintech startups offer services to this segment, most solutions are not purpose-built for their unique needs. Tide aims to change that with its unified business platform, offering tailored tools such as accounting integrations, invoicing, business loans, asset finance, payroll, expense cards, and even company registration.

    Initially launched in the U.K. in 2017, Tide expanded into India in December 2022 to tap into the country’s vast base of small enterprises — around 60 million micro and small businesses employing over 250 million people, per the recent Indian government data. Since its entry, Tide has onboarded more than 800,000 Indian businesses, which it refers to as “members” — surpassing its U.K. member base of nearly 800,000. In the U.K., where Tide is already profitable, the company serves around 14% of the country’s small and medium business market.

    “There is a huge trend to formalization. So, our biggest enemy is cash, and not any competitors,” said Oliver Prill, CEO of Tide, in an interview.

    “In India, there’s a debate, as the growth rate slowed a little bit, but it’s still a hugely impressive growth rate. You look at continental Europe or the U.K., the growth rate is a lot less,” he told TechCrunch.

    Tide estimates that around four million micro and small businesses are launched in India every year. These businesses typically seek support in areas like accessing formal credit, accepting Indian government-backed Unified Payments Interface (UPI) for payments, and navigating the country’s indirect tax system, the Goods and Services Tax. Tide serves them through its digital platform, available as an app on both iOS and Android.

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    The U.K. startup expects to onboard one million businesses in India by the end of this year and is already seeing strong demand from tier-3 cities and beyond (referring to smaller, less urbanized towns with limited digital and financial infrastructure), Gurjodhpal Singh, CEO of Tide India, told TechCrunch.

    In India, Tide works with around 25 lenders on its platform to facilitate credit for small businesses, recommending partners based on each business’s needs. The company also offers services such as fixed deposits, bill payments, bank transfers, and cash withdrawals through ATMs.

    In addition to the U.K. and India, Tide launched in Germany in May 2024 and expanded into France earlier this month. The startup offers a tailored experience in each market, including local language support.

    With the fresh funding, Tide plans to expand further geographically, enhance its product, and invest in agentic AI.

    The startup covers a range of finance and admin services already, but there are still some gaps to fill. “In the next few months and quarters, you’ll see some major developments in that area,” Prill said, referring to upcoming product launches enabled by the latest funding round.

    Tide currently employs over 2,500 people across its global operations.

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    Jagmeet Singh

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  • SoftBank-backed FirstCry seeks to raise nearly $220 million in India IPO | TechCrunch

    SoftBank-backed FirstCry seeks to raise nearly $220 million in India IPO | TechCrunch

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    E-commerce startup FirstCry is seeking to raise $218 million through issue of fresh shares in its initial public offering, the 13-year-old startup said in a draft prospectus filed with the market regulator Thursday, becoming the latest Indian startup to explore the public markets.

    FirstCry earlier sought to raise as much as $700 million in its Mumbai IPO, but deterred the plan as the market conditions worsened.

    Brainbees Solutions, the parent firm of online baby product marketplace FirstCry, said that some investors including SoftBank. NewQuest and TPG plan to sell some shares. The startup is eyeing a valuation of about $4 billion, down from previous $6 billion ambitions, according to a person familiar with the matter. FirstCry said it hadn’t set the price in its draft prospectus.

    More to follow.

     

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    Manish Singh

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  • Grihum Housing exploring co-lending tie-ups, insurance distribution: MD

    Grihum Housing exploring co-lending tie-ups, insurance distribution: MD

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    Coming out from the umbrella of the Poonawalla Group with the backing of global alternative asset manager TPG, has opened opportunities for Grihum Housing Finance, formerly Poonawalla Housing, to focus on its sole objective of affordable housing, according to MD and CEO Manish Jaiswal.

    The housing financier is now exploring co-lending tie-ups to grow its book and has also applied for a corporate agency insurance licence to offer insurance cover to its borrowers, Jaiswal told businessline, adding that the lender is aiming to organically double the loan book in the next three years. “We need to get about 2.5 lakh people in their own homes to meet the one million lives target. We are at 75,000-plus customers now (a little over 3 lakh counting family members) which is just one-third of our target. So we are just getting warmed up,” Jaiswal said, adding that becoming one of the country’s leading fintech affordable HFCs is a “big goal”. Edited excerpts:

    How has your strategy changed coming out from the Poonawalla group?

    Grihum’s potential as a standalone HFC has been unleashed since it can now reimagine its own business architecture without the shackles of a subsidiary structure. Grihum has a massive opportunity of reaching out to innumerable Indians in the hinterlands who have still not experienced living in their own homes. Our ability to cater to self-made individuals in semi-urban areas, stands substantially augmented given our strong alliance of goals with TPG.

    Has the TPG ownership opened more opportunities for foreign and multilateral funding?

    Most certainly, we now have access to the global TPG ecosystem which provides us with opportunities such as sovereign funds, pension funds and multilateral agencies. There are a few players already talking to us and it’s a matter of time before this plays out. TPG has committed ₹1,000 crore, of which the first part has been infused and the second tranche will come when we need it. We want to first deploy this ₹1,000 crore and generate another ₹5,000 crore of organic book growth. With a brand like TPG, capital is not an issue. And between being worried about capital raising and running the business, I’d rather focus on the latter.

    Affordable housing growth has been muted since the pandemic. Has it become harder to be a standalone affordable HFC and will you be looking at other income segments?

    The country is experiencing phenomenal urbanisation on the back of last-mile connectivity driven by infrastructure development. We have been consistent in our operations with a singular focus for the last seven years. There’s an opportunity to mine in the sector because about one crore people don’t have their own homes. I believe the vision of ‘Housing for All by 2022’ should be augmented to 2032 because it will require at least a decade of hard work to realise this goal. There is deep starvation for liquidity, reflected in the over 2 crore loans already given by fintechs. Yes, there will be delinquencies and some hits and misses, but overall, there is terrific opportunity to look at this particular sector from varied lenses, one of which could also be home loans. As the economy grows, disposable incomes and consumption spends will increase, and borrowers usually don’t want to default on home loans. As long as we’re doing secured, granular and low-ticket lending, not taking on undue construction risks, and choosing our customers well, 95 per cent decisions should be correct and the remaining are accounted for in the model. So I’m very positive on this sector and we remain committed to this purpose and focussed on this segment.

    Are you looking at co-lending partnerships?

    We are evaluating co-lending opportunities with a couple of banks, and that will hopefully come into play by the next financial year. This apart, there will be more avenues to raise liabilities, opening up for the housing sector, such as residential mortgage-backed securities. The country’s largest HFC’s merger with a bank has also opened up massive limits with both banks as well as corporate bonds.

    Will you look to grow the LAP (loans against property) portfolio faster?

    Our focus remains on the ‘First Home, Dream Home’ segment. While serving these customers, we also serve customers of homogenous nature of credit and collateral profiles who have affordable business loan needs. But we don’t ever see our product mix changing, home loans will remain at 70 per cent of the portfolio and LAP at 30 per cent.

    What is the rate of customer onboarding?

    We currently onboard around 3,000 customers a month and about 40,000 per year, but this capacity will grow by another 30-40 per cent next year. We are doubling our loan book every three years, about 70 per cent of which are home loans. A third of our loan book directly contributes to development of new self-construction properties in semi-urban and rural geographies. We focus on customers with average household income of ₹40,000-60,000 rupees per month and thus average home loan ticket size of about ₹10-12 lakh.

    Are you looking at insurance and other products for alternate revenue streams?

    We look at the needs of customers, and many of them certainly need to secure themselves and their families and homes from the vagaries of life and nature. We have applied for a corporate agency license, and hope to get it soon. This will provide us the ability to partner with life and non-life insurers and also evaluate home credit insurance once the premium rates are affordable. We will invest ₹165 crore in reimagining our IT stack to create a deep digital arsenal for the company, which will significantly boost our ability to fetch many APIs and collaborate with more partners.

    We focus on customers with average household income of ₹40,000-60,000 rupees per month and thus average home loan ticket size of about ₹10-12 lakhManish JaiswalMD and CEO, Grihum Housing Finance

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  • Ontario Teachers’ fund backs Indian logistics unicorn Xpressbees in $80 million funding | TechCrunch

    Ontario Teachers’ fund backs Indian logistics unicorn Xpressbees in $80 million funding | TechCrunch

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    Xpressbees, an Indian logistics firm that works with several e-commerce firms in the country, has raised $80 million in a new funding round led by Ontario Teachers’ late-stage venture growth fund amid a surge in the country’s online shopping activity.

    The Canadian pension fund has acquired a stake in the Pune-headquartered startup at about $1.4 billion valuation, same value at which the startup raised a Series F tranche earlier. With the latest investment round, Xpressbees’ cumulative funding has reached approximately $680 million. It didn’t share a name for the round, and also didn’t disclose how much of the new raise came via secondary transactions.

    Xpressbees, which also counts Malaysian sovereign wealth fund Khazanah, TPG, Alibaba and Blackstone among backers, works with more than 1,000 clients — including financial and e-commerce services giant Paytm, social commerce startup Meesho, eyewear seller Lenskart, phone maker Xiaomi, and online pharmacy NetMeds — deliver their products across the country.

    It has presence in over 2,000 cities and towns and it processes more than 2.5 million orders a day. The loss-making startup posted a revenue of about $300 million in the financial year ending March. The arrival of the Canadian pension fund is indicative that Xpressbees is readying itself for an initial public offering within a year to two.

    Xpressbees started its journey within FirstCry, an e-commerce for baby products, in 2012. But in 2015, it became an independent company with Amitava Saha, co-founder and chief operating officer of FirstCry, moving out of FirstCry to become chief executive of Xpressbees. Supam Maheshwari, who co-founded FirstCry and serves as its chief executive, is the other co-founder of Xpressbees.

    “We are excited about the market opportunity for end-to-end logistics and supply chain solutions that can meet the needs of a diversified customer base across industries, including e-commerce in India,” said Deepak Dara of Ontario Teachers, in a statement. “Led by a strong team, Xpressbees has established a highly scalable and efficient asset-light model with proven execution capabilities.”

    Ontario Teachers’ has invested over $3 billion in India, and identifies it as one its “key strategic” countries.

    Xpressbees competes with a handful of established firms and startups, including publicly listed firm Delhivery and Shadowfax, which is in advanced stages of talks to raise about $60 million in a round led by TPG NewQuest, TechCrunch earlier reported.

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    Manish Singh

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