Digital trade finance platform Drip Capital has raised $113 million in a fresh funding round, combining equity and debt, to accelerate its expansion plans and enhance product offerings for small and medium-sized businesses (SMBs) across key markets, including India and the US.
The funding round includes $23 million in equity from two major Japanese institutional investors—GMO Payment Gateway and Sumitomo Mitsui Banking Corporation (SMBC)—along with $90 million in debt, sourced from the International Finance Corporation (IFC) and East West Bank.
Some of Drip's existing investors also participated in the round.
“Our revenue has quadrupled over the last 2.5 years, and we’re targeting consistent 40 percent growth over the next two,” said Pushkar Mukewar, CEO and Founder of Drip Capital, in an interview with Moneycontrol. While the US-headquartered firm is yet to file its results for FY24, it claims to have achieved breakeven or cash profitability during the financial year.
Founded in 2016, the Palo Alto and Mumbai-based firm provides SMBs in India and the US with trade financing solutions such as receivables discounting for immediate payment on shipped goods and supply chain financing for extended credit terms.
The company recently launched a forex solution in partnership with Barclays, offering SMBs a transparent and cost-effective alternative for handling international remittances.
Additionally, Drip is piloting a platform to connect buyers with global suppliers.
The platform claims to serve over 9,000 sellers and buyers across more than 100 countries and has financed over $6 billion in trade transactions to date, with 60 percent of its business coming from India, followed by the US and Latin America.
To date, Drip has raised about $640 million in equity and debt funding, including Series C round of $175 million in 2021, from investors like Accel, Wing, Transpose Platform, Peak XV Partners and Y Combinator.
“We’re doing almost $1.7–1.8 billion annually in trade financing on the platform,” Mukewar added.
The CEO also highlighted the growing interest from Japanese investors in the Indian market, noting, “Japanese institutional investors are very bullish on India, especially given the current geopolitical climate. Both GMO Payment Gateway and SMBC see immense potential in the trade finance and supply chain sectors, which aligns perfectly with our mission.”
Navigating the trade finance market
Drip Capital operates at the intersection of technology and finance, helping businesses in emerging markets access credit for international trade. Mukewar discussed the challenges SMBs face in securing working capital.
“In many cases, SMBs don’t have access to traditional banking services or they struggle with high-interest rates. We’re addressing this gap by offering them scalable, digital solutions for trade finance, which allows them to grow faster,” he explained.
The $90 million in debt financing will help strengthen Drip’s liquidity to support its growing client base.
Currently, Drip works with large institutional partners, including Barclays Bank, East West Bank, and the newly onboarded IFC. Additionally, the company partners with family offices and high-net-worth individuals (HNIs) to offer invoice discounting or credit lines to SMBs.
When asked about the possibility of moving the company’s headquarters to India, Mukewar said the team is evaluating the move but is still in the early stages. “We’re exploring a reverse flip, but we’re taking a cautious approach. It would give us greater operational flexibility, particularly as we deepen our focus on India and surrounding markets, but regulatory considerations remain,” he said.
“We need to understand all the nuances, including tax and regulatory implications. We’re having conversations with advisors to explore what it would entail, but nothing concrete has been decided yet,” he added.
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