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 in recent times.
The funding is a part of a $40 million recent funding Progcap has raised, it stated. Creation Investments and Tiger World led the 5-year-old startup’s Collection C financing spherical, which almost tripled its valuation to $600 million since September final 12 months. Present backer Sequoia India and Southeast Asia additionally participated within the spherical, Progcap stated.
The brand new funding extends to $70 million, the startup’s Collection C, the primary tranche of which it closed in September. With the recent funding, the Delhi-headquartered startup’s all-time increase 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 we now have previously written, a big variety of retailers in India battle 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 TechCrunch. “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 gives retailers with instruments to verify their account assertion and invoices, and gives methods to make on-line funds and observe disbursals.
Progcap goals to change into “a full-stack retailer-focused digital financial institution that digitizes, automates and eases capital motion throughout the provision chain,” she stated.
Previously 4 years, Progcap says it has disbursed about $1 billion to retailers, which function in a wide-range of sectors, a determine it’s at present on observe to disburse this 12 months. The retailers Progcap serves have a yearly money move of about $125,000, the startup stated.
“We’re delighted that our present buyers 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 prospects, offering them with credit score and expertise options that make their companies extra environment friendly.”
Google, which already serves many of those small companies, is the newest agency to point out 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 big is working with CDC Group–backed Indifi to present 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% to twenty% every year and gained’t require the companies to supply any collateral or becoming a member of charge, it informed TechCrunch.
“We’re delighted to speculate as soon as once more behind the Progcap workforce as they broaden their product providing and additional serve last-mile retailers in India,” stated Tyler Day, a accomplice at Creation Investments, in an announcement.
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