PhonePe raises $350 million from General Atlantic
Financial and payment services unicorn The Walmart-backed business PhonePe has raised $350 million in a fresh round of funding from General Atlantic at a valuation of over $12 billion, making it the most valuable fintech in India. The company announced in a statement that it will be raising up to $1 billion in the current round in instalments.
PhonePe is considering a $12 billion financing from General Atlantic. The fundraising effort by PhonePe comes after the company announced its spin-off from e-commerce startup Flipkart in December. The Flipkart spin-off also completes the process that began earlier in 2022 to give PhonePe full Indian corporate citizenship.
With the valuation markup, PhonePe has become a decacorn or a startup valued at over $10 billion, joining the likes of Flipkart, which was acquired by Walmart, Paytm, which went public last year, Byju’s and Swiggy. PhonePe’s valuation has also surpassed that of digital payments and neobanking unicorn Razorpay, which was last valued at about $7.5 billion.
The new fundraise is a rare instance of a late stage round amid a startup funding winter where investors are signing smaller cheques as they turn cautious in a deteriorating macro environment. PhonePe was valued at $5.5 billion when it was hived off into a separate entityinto a separate entity by Flipkart. Flipkart had pumped in $700 million then.
The money raised by PhonePe comes at a time when Paytm, its closest rival, has witnessed a valuation decline of more than 60% since going public in November of last year, prompting public shareholders to voice concerns about the company's potential to reach company-level profitability. The overall market value of Paytm was just over $4.3 billion as of January 19. However, Paytm generates far more revenue than PhonePe.
Paytm and PhonePe each earned revenues of Rs 3,892.40 crore and Rs 1,646 crore, respectively, as of FY22. In addition, PhonePe reported a loss for FY22 (2021-2022) of Rs 2,014 crore, an increase from Rs 1,729 crore for FY21 (2020-21). Paytm, on the other hand, posted a net loss for FY22 of Rs 2,325 crore, an increase from Rs 1,560 crore in FY21.
PhonePe is considering a $12 billion financing from General Atlantic. The fundraising effort by PhonePe comes after the company announced its spin-off from e-commerce startup Flipkart in December. The Flipkart spin-off also completes the process that began earlier in 2022 to give PhonePe full Indian corporate citizenship.
With the valuation markup, PhonePe has become a decacorn or a startup valued at over $10 billion, joining the likes of Flipkart, which was acquired by Walmart, Paytm, which went public last year, Byju’s and Swiggy. PhonePe’s valuation has also surpassed that of digital payments and neobanking unicorn Razorpay, which was last valued at about $7.5 billion.
The new fundraise is a rare instance of a late stage round amid a startup funding winter where investors are signing smaller cheques as they turn cautious in a deteriorating macro environment. PhonePe was valued at $5.5 billion when it was hived off into a separate entityinto a separate entity by Flipkart. Flipkart had pumped in $700 million then.
The money raised by PhonePe comes at a time when Paytm, its closest rival, has witnessed a valuation decline of more than 60% since going public in November of last year, prompting public shareholders to voice concerns about the company's potential to reach company-level profitability. The overall market value of Paytm was just over $4.3 billion as of January 19. However, Paytm generates far more revenue than PhonePe.
Paytm and PhonePe each earned revenues of Rs 3,892.40 crore and Rs 1,646 crore, respectively, as of FY22. In addition, PhonePe reported a loss for FY22 (2021-2022) of Rs 2,014 crore, an increase from Rs 1,729 crore for FY21 (2020-21). Paytm, on the other hand, posted a net loss for FY22 of Rs 2,325 crore, an increase from Rs 1,560 crore in FY21.
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