KhataBook, a Bengaluru-based financial Company, has raised $100 million in Series C funding, valued at $600 million. Tribe Capital and Moore Strategic Ventures (MSV) led the financing.

Other investors in the oversubscribed series C round included Alkeon Capital, with internal investors B Capital Group, Sequoia Capital, Tencent, RTP Ventures, Unilever Ventures, and Better Capital continuing to participate. Balaji Srinivasan and Sriram Krishnan, among others, participated as independent investors.

The company has recently stated that their ESOP pool has been increased to $50 million. It also announced that it will purchase back $10 million in ESOPs to thank and reward employees, ex-employees, and early investors. Employees who qualify will be able to sell up to 30% of their vested options. Khatabook has also increased the size of its employee stock ownership plan (ESOP) pool to $50 million.

Khatabook will use this new amount of funding to focus on financial services disbursement via its software ecosystem, which serves 10 million monthly active MSMEs. To expand its engineering, product, design, analytics, and data science capabilities, the business wants to increase hiring.

Ravish Naresh, CEO, and Co-founder, Khatabook, said, "The first phase of our journey was enabling digital transformation by building a tech ecosystem for Indian MSMEs. Now that we have created a widely accepted digital platform, the next step will be digitally-enabled financial services for small businesses. We are humbled by our investors' confidence in our mission to help local businesses succeed by providing them with the right digital empowerment. On this milestone for the company, we would like to acknowledge the contribution of employees and early investors through the ESOP buyback plan."

In FY 20-21, the startup saw a 150 percent year-over-year (YOY) growth, according to the announcement.

Arjun Sethi, Co-founder and Partner at Tribe Capital, said: “At Tribe, we believe strongly in the power of the network effect and how it can create moats for businesses. Khatabook has successfully built such a network by empowering this seismic shift among MSME businesses to move from paper to digital, literally. Despite its large early success and fast adoption to date, the company is early in its path to power the segment. We’re thrilled to be a part of its growth as it leverages its network to build additional scale.”

According to the company, it has users in practically every district across the country. The startup's next phase will be focused on financial service disbursement via its internet platforms. It added that in addition to providing financial services, the money will assist the business in expanding its talent pool. Khatabook, which presently employs over 200 people, plans to ramp up employment, particularly in engineering, product, design, analytics, and data science.

James McIntyre, Senior Managing Director & COO of MSV, said: “We are excited to partner with Khatabook as they continue to provide millions of small & medium sized retailers in India with outstanding software products. This round will accelerate the growth of technology products with which Khatabook’s customers can better serve Indian consumers. Additionally, this round enables the launch of a next-generation financial services platform to escalate the growth of those same customers.”