Google has invested in Progcap, an Indian startup that gives working capital to small and medium-sized companies, the companies stated Tuesday, making a brand new push right into a class that has attracted the eye of Fb and Amazon lately.
The funding is a part of a $40 million contemporary funding Progcap has raised, it stated. Creation Investments and Tiger International led the five-year-old startup’s Sequence C financing spherical, which practically tripled its valuation to $600 million since September final 12 months. Current backer Sequoia India and Southeast Asia additionally participated within the spherical, Progcap stated.
The brand new funding extends to $70 million the startup’s Sequence C, the primary tranche of which it closed in September. With the contemporary funding, the Delhi-headquartered startup’s all-time elevate has surged previous $100 million.
Progcap serves greater than 700,000 small retailers, who dot a whole bunch of Indian cities and cities. The startup extends a revolving credit score line of $10,000 to $12,500 to retailers, offering them with much-needed capital to purchase new inventories and develop their companies.
As now we have beforehand written, a big variety of retailers in India wrestle with entry to working capital. “The hole within the working capital financing market is round 98%,” stated Pallavi Shrivastava, co-founder of the startup, in an interview with Nob6. “The market is totally unorganized and insufficiently addressed.”
The startup, which makes use of its personal underwriting tech and entry to retailers’ funds to find out their creditworthiness, additionally supplies retailers with instruments to test their account assertion, invoices, make on-line funds and observe disbursals.
Progcap goals to grow to be “a full-stack retailer-focused digital financial institution that digitizes, automates and eases capital motion throughout the availability chain,” she stated.
Progcap says it has disbursed up to now 4 years about $1 billion to retailers, which function in a wide-range of sectors, a determine it’s at the moment on observe to disburse this 12 months. The retailers Progcap serves have a yearly money circulation of about $125,000, the startup stated.
“We’re delighted that our present traders have continued to deepen their conviction in Progcap and thrilled that Google has joined us on this journey,” stated Shrivastava and Himanshu Chandra, Progcap’s different co-founder.
“Progcap is changing into the core working engine for all of the transactions of its clients, offering them with credit score and know-how options that make their companies extra environment friendly.”
Google, which already serves many of those small companies, is the most recent agency to indicate curiosity in serving to these retailers with their funds. Fb launched a program in India final 12 months to assist small and medium-sized companies safe loans.
The social large is working with CDC Group-backed Indifi to provide small ticket loans — ranging between 500,000 Indian rupees ($6,720) to 50,00,000 ($67,200) — at a predefined rate of interest of 17%-20% each year and received’t require the companies to offer any collateral or becoming a member of payment, it advised Nob6.
“We’re delighted to take a position as soon as once more behind the Progcap workforce as they develop their product providing and additional serve last-mile retailers in India,” stated Tyler Day, a accomplice at Creation Investments, in a press release.