Money in the bank for MobiKwik, as Sequoia and Tree Line Asia wire in cash.
New Delhi | By Biswarup Gooptu, ET Bureau | 29 Dec, 2015, 03:45 PM IST.
Online recharge and mobile wallet company MobiKwik has received an additional Rs 44 crore, a mix of debt and equity, from its existing investors, Sequoia Capital and Asia-focused hedge fund Tree Line Asia.
According to documents filed by the Gurgaon-based venture with the Registrar of Companies, and which have been accessed by ET, Sequoia Capital, through its investment vehicle, Sequoia Capital India Investment IV, has pumped in an additional Rs 22.48 crore, while Tree Line Asia, through Tree Line Asia Master Fund (Singapore), has also invested about Rs 9.92 crore in the company.
This tranche, B4, is part of the company's Series B round, with funding from other existing investors -- American Express and Cisco, also expected to come in at a slightly later date.
"This is not new funding but part of the April funding which was slated to be released later in the year," Mrinal Sinha, chief operating officer at MobiKwik, wrote in an emailed response to an ET questionnaire.
Both, Sequoia and Tree Line, have been issued a total of 89,844 cumulative compulsorily convertible preference shares, at Rs 3,605.57 per share, in lieu of their investment.
Additionally, Innoven Capital, the Temasek-owned venture debt firm, has provided debt financing of Rs 12 crore that will be used by the company to meet its working capital needs.
The announcement of the $25 million fund raised followed media reports in January that stated the company was looking to raise between $80 million and $100 million. CEOBipin Preet Singh was reported as saying that MobiKwik would look to dilute a 25% stake at a valuation of $400 million.
"We are on track for our financial year 2016 fund raise, but do not have any specific updates as of now," Sinha said.
In April, MobiKwik had announced that it had raised a little over Rs 150 crore in its Series B round of funding. As per records, Cisco Investments had put in about Rs 19 crore in May, prior to which MobiKwik had received a little over Rs 80 crore from Tree Line, Sequoia Capital and American Express.
India's digital payments and services sector has seen significant funding action over the past 12 months, with some of the most prominent risk capital investors lining up to bet on the space.
Chinese ecommerce giant Alibaba Group and its affiliate Ant Financial have invested $680 million in Noida-based One97 Communications in September, while Snapdeal, India's largest online marketplace, acquired FreeCharge in April for about $400-$450 million, the largest acquisition in the country's startup M&A leaderboard till date.
More recently, Mumbai-based Citrus Payment Solutions raised $25 million in a new round that was led by existing investor Sequoia Capital and new investor, mid-to-growth stage private equity firm, Ascent Capital.
However, the past six months have seen a number of prominent investors slow down their pace of funding of Indian startups.
The middle market of $15-20 million financings was served mainly by hedge funds, which have slowed their pace of investments in India as global equity markets turned choppy this year.
Venture capital investor are also tightening their purses, and have begun to scrutinise portfolio companies in terms of their expenses, business models and process, asking when they expected to become self-sustaining businesses.