The Capital Quest | Advent leads $120 mn Series D top-up for fintech startup KreditBee

Fintech startup KreditBee said Friday it has topped up its Series D round with another $120 million, led by private equity firm Advent International.

This takes the funding round to $200 million and pushes the company into the club of ‘soonicorns’, or a startup at the cusp of attaining a valuation of $1 billion or more.

KreditBee has raised $100 million from Advent and $20 million from others. This adds to $80 million it raised as part of the Series D round from existing investors PremjiInvest, Motilal Oswal Alternates, TPG-backed NewQuest Capital Partners and Mirae Asset Ventures with participation from Japan’s MUFG Bank, last month.

The Series D round has been struck at a pre-money valuation of around $500 million or a post-money valuation of around $700 million.

The venture, co-founded by Madhusudan Ekambaram, Vivek Veda and Karthikeyan Krishnaswamy, will use the money to scale existing business and diversify its product offering by venturing into digitally enabled financial products.

The startup is looking to expand its product portfolio by introducing financial services such as insurance, credit score report, and merchant-side offers. It is also aiming to cross an asset under management of more than $1 billion over the next 2-3 quarters.

The startup runs a tech platform which originates loans for its non-banking company company (NBFC) unit KrazyBee Services Pvt Ltd. The company offers unsecured personal loans to young professionals, with ticket size varying from Rs 3,000 to Rs 3 lakh with average tenure of around five months and average annual percentage rate of around 42%. Prior to FY19, the company offered loans to students with a tenure of up to two years.

The tech platform earns revenue by way of processing fees from borrowers, along with commission income from partner lenders, and gives first loss default guarantee (FLDG) of 5-10% to partner vendors.

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