bansal: Scoop: Flipkart co-founder Binny Bansal looks to charge PhonePe with $100-150M investment

Flipkart co-founder Binny Bansal is in talks to invest about $100-150 million in PhonePe as part of an ongoing funding round at the digital payments company, experts said. The transaction, if it goes through, will be one of the largest individual investments in a new-age company, comparable to the $100 million bet Flipkart’s other founder Sachin Bansal made in Ola in 2018.

“The amount he (Binny Bansal) is investing is yet to be finalized. Talks are ongoing and are likely to be concluded soon,” said a person familiar with the talks.

PhonePe has already raised nearly $450 million in primary capital from PE major General Atlantic, Tiger Global, Ribbit Capital in this current round of funding, at a valuation of $12 billion. Some of the existing shareholders in Flipkart such as Bansal, Tiger Global, China’s Tencent, Qatar Investment Authority and Microsoft were expected to buy a new stake in PhonePe as the company put together a new ownership structure.

Walmart remains the largest investor in PhonePe with a stake of approximately 70%.

PhonePe is the dominant online payments app on India’s Unified Payments Interface (UPI), clocking up about four billion transactions monthly, Walmart International president and CEO Judith McKenna said last month. By the end of 2022, the total payment volume (TPV) will reach $950 billion, she said.

It competes directly with the likes of Google Pay, Paytm, Amazon Pay and WhatsApp Pay on the UPI network. PhonePe has said it had a market share of 50.2% of UPI transactions in December last year.

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ET reported on Nov. 25 that PhonePe was in the final stages of talks to acquire buy-now-pay-later (BNPL) startup ZestMoney as it aims to make money through financial services. Bansal, who was instrumental in Flipkart’s acquisition of PhonePe in 2016, has remained on the board and is closely associated with the company’s founders, Sameer Nigam and Rahul Chari.

In fact, Nigam, Chari and Burzin Engineer had previously founded Mime360, a digital media distribution company, which was also sold to Flipkart in 2011 to help the e-commerce player build its Flyte digital music distribution platform.

The deal takes on significance because it comes at a time when the overall tech industry has experienced an extended period of slowdown in funding activity.

More money to Curefoods

In addition to PhonePe, Bansal has also poured additional funds into Curefoods, a cloud kitchen platform, which spun off in 2016 from Cultfit, founded by Mukesh Bansal and Ankit Nagori. He has bought Cultfit’s secondary shares in Curefoods, three well-known people with the deal talks said. Sources said Bansal’s ownership has risen from less than 5% in Curefoods to about 12-13% with the $25-30 million investment.

Ankit NagoriETtech

Ankit Nagori, Co-Founder, Cultfit

“After Mukesh Bansal and Nagori parted ways and Curefoods took shape separately in 2021, Binny Bansal had funded the platform… He is now doubling down by ramping up his share holdings,” said another person familiar with the situation.

Bansal’s other big investment is in new-age insurance company Acko, where he has a stake of about 8-9% and first invested in 2018. Since then, Bansal has invested a total of about $30 million in the company, said people on the were aware of the matter. . Acko is currently valued at $1.1 billion.

Email inquiries sent by ET to Bansal and spokespersons for PhonePe and Curefoods did not receive a response until Thursday.

Bansal investment vehicles

The entrepreneur turned investor is not only an angel and early stage financier of Indian startups but has distinguished himself by plowing funds into later stages as well. And several people who know about Bansal’s thinking told ET that they were taking seats on board at companies like PhonePe and Curefoods.

Binny Bansal top investmentsETtech

His startup investments are channeled through various entities such as Singapore-based Three State Capital; 021 Capital – a fund founded by Bansal’s financial advisor Sailesh Tulshan, where he is the largest sponsor; as well as xto10x Technologies, which he co-founded with former Flipkart senior executive Saikiran Krishnamurthy.

His other portfolio companies include electric scooter maker Ather Energy, urban mobility startup Yulu, loan platform Rupeek, and the 80 companies he has supported according to data from research firm Tracxn.

In 2019, Bansal planned to launch a venture capital fund. However, the plan failed to pay off and he has since supported startups from his personal pool of capital.

ET reported in December 2021 that Bansal sold a portion of its approximately $200 million stake in Flipkart as part of the $3.6 billion funding round the e-commerce giant closed that year. Those investing in that round included Canada Pension Plan Investment Board (CPP Investments), the Singapore government’s sovereign wealth fund GIC, and Japan’s SoftBank.

Bansal has taken concentrated bets where he has lowered bigger checks for more mature companies, said another person familiar with his strategy.

“In the last few quarters, he has also been spending more time in India with frequent visits to Bangalore,” another person said on condition of anonymity.

“In addition to his investments, he also spends more time on xto10x. They are also considering investing in startups through xto10x,” said one person who knew about the matter.

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