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OfBusiness raises $110 million led by Falcon Edge, valued at close to $800 million

Lending firm OfBusiness has raised $110 million valuing it at close $800 million, nearly triple its valuation from less than two years ago. The deal is also important given that small business lenders were among the worst hit during the pandemic and yet, some have recovered to become even stronger

Mumbai / April 08, 2021 / 07:53 AM IST

OfBusiness, which lends to small enterprises by providing raw material in addition to just capital, said on April 8 that it has raised $110 million led by existing investor Falcon Edge Capital. Other investors including Matrix Partners India, Creation Investments, and Norwest Venture Partners also participated in the round.

According to a person close to the deal, it was valued at close to $800 million post money, a big jump from its last round in October 2019 when it was valued at $275 million.

Investors say the company has been able to maintain the quality of its loan book- a challenge for many during the pandemic- and has also expanded its ecommerce business into multiple raw material supply chains serving  including heavy machinery, consumer goods, agri-processing and nation-building projects including metro lines, highways, affordable housing, irrigation and drinking water.

“In our mission of serving businesses who are core to nation-building, we have attained strong growth with profitability even through these uncertain periods. We have an unwavering belief in the potential of commerce and financing in the B2B landscape and our vision is to just keep doing more of what we have done so far,” said Asish Mohapatra, co-founder and CEO, OfBusiness.

Over the last year, it has also raised  $200 million in debt  from its lending partners including IDFC First Bank,, SBI,HDFC and Swiss firm ResponsAbility among others. It plans to use the money raised to expand the number of supply chains and expand its presence to more regions.

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OfBusiness says it has a gross merchandise value  (GMV) run rate of $1.5 billion and a profit before tax run rate of $20 million. Run rate means a particular month’s numbers multiplied by twelve (annualised).

“OfBusiness has demonstrated leadership across both the Fintech and B2B Commerce domains. The team has been able to significantly scale its assets and profitability across both businesses driven by a full stack tech platform and a strong liabilities framework. They have been able to do this by investing in a top team and by ensuring robust credit quality and business processes,” said Niren Shah, Managing Director and Head, Norwest Venture Partners India

The deal also continues Falcon Edge’s recent dealmaking run. While the Navroz Udwadia-led firm also invests in early stage firms via Alpha Wave Incubation- an Abu Dhabi based fund, Falcon Edge’s recent larger deals include fantasy sports platform Dream11, food delivery firm Swiggy, fintech firm Cred and news aggregator Dailyhunt, among others.

 
M. Sriram
first published: Apr 8, 2021 07:53 am

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