Jupiter neobank has raised money from QED Investors, a fintech-focused fund whose investments NuBank, Affirm, and SoFi are among the hottest fintech startups in the world currently, and signals its intent to invest more in India, said people familiar with the matter.
Jupiter, founded by fintech veteran Jitendra Gupta is among a slew of startups looking to upend traditional banking and provide a superior experience along with a platform for financial services.
QED, a US-based investor, was co-founded by Nigel Morris, who previously co-founded Capital One, one of the US’ largest financial institutions. QEDs investment in Jupiter was led by Morris along with Sandeep Patil, who joined the firm last year from Truecaller, to lead investments in India and Southeast Asia.
QED did not respond to an email seeking comment while Gupta declined to comment.
QED’s investment of close to $10 million supplements the $45 million Jupiter raised recently from Brazil’s leading neobank- Nubank, along with other investors such as Rocket Internet, Sequoia Capital, Matrix Partners and others.
“The round was done before QED came in, Jiten (Gupta) raised because his internal investors recommended QED and its global fintech connections highly,” said a person involved in talks.
“Nubank led this round so it was convenient for QED to establish the connection and invest with confidence,” the person added.
Jupiter rolled out its platform in June, 1.5 years after it raised its first funding round, and got 30,000 signups in the first three weeks. Jupiter and Sequoia-backed rival Epifi both use Federal Bank as the backend for their operations.
Epifi, which launched a few months before Jupiter snagged users earlier, and benefitted from a rule that allowed a customer to have only one Federal Bank account- thus gaining users instead of Jupiter. However, this has been ironed out with the bank recently and now users and open accounts with both neobanks.
Jupiter is Gupta’s second startup after he sold payments gateway Citrus Pay to Naspers-owned PayU for $130 million, one of the larger startup exits at the time. On the idea of Jupiter, Gupta raised $25 million from top venture funds such as Sequoia, Matrix Partners, former Tiger Global head honcho Lee Fixel and others.
Gupta wants Jupiter’s customer experience to be similar to food delivery firm Swiggy, whose customer resolution via live chat has become an industry-standard, he told Moneycontrol in June.
The deal marks QED’s third Indian investment, after Refyne- which helps employees access their earned wage before they officially get it; and OneCard- a new age credit card.Neobanks, which have become large multi-billion dollar companies in Latin America, Russia and other markets, have been touted to be the next big thing in the Indian technology scene for two years now, and startups including Jupiter, Epifi and others were able to raise money only on an idea. Some neobanks such as Niyo and RazorpayX cater largely to small businesses, while others cater exclusively to consumers.