Fintech Startup PhonePe raises $100M from General Atlantic

PhonePe, the Indian fointech startup owned by Walmart, has raised an additional USD 100 million from General Atlantic and its co-investors as part of its ongoing USD 1 billion fundraise. With this tranche, the company has now raised USD 750 million from several global investors.

The current investment is said to have taken place at a similar valuation to the USD 12 billion pre-money valuation at which General Atlantic invested USD 350 million earlier this year. 

How Will PhonePe Use The Fund?

The ongoing fundraise follows PhonePe's recent shift in domicile to India. The company plans to use the funds to build and scale new businesses like insurance, wealth management, lending, stockbroking, ONDC-based shopping, and account aggregators. The fundraise will also help PhonePe turbo-charge the next wave of growth for UPI payments in India, including UPI Lite and Credit on UPI. 

What Were The Previous Funds Raised by PhonePe?

In January, PhonePe announced raising USD 1 billion in tranches at a valuation of USD 12 billion. Since then, the fintech has raised USD 350 million from General Atlantic, USD 100 million from Tiger Global Management, Ribbit Capital and TVS Capital, and USD 200 million from its largest shareholder--Walmart.

Confirming the funding, a Spokesperson with Phonepe said, “PhonePe confirms a USD 100Mn additional tranche of investment from General Atlantic, a leading global growth equity firm, and its co-investors as part of our ongoing fundraise. General Atlantic initially invested USD 350Mn in PhonePe in January 2023.".

Pincode App Launched to Connect Local Shopkeepers with Consumers

Recently, PhonePe launched a new consumer-facing application, Pincode, which will be integrated into India's Open Network for Digital Commerce (ONDC) framework. The Pincode app aims to promote local shopkeepers and sellers and digitally connect each city's consumers with their neighborhood stores that they usually buy from offline. The app offers the convenience of online ordering, great discounts, and instant refunds and returns.

PhonePe's Growth Trajectory

PhonePe has been a major player in India's digital payments space since its inception in 2015. The platform offers a range of financial services to users, including mutual funds and insurance products, and competes with publicly listed Paytm and Google Pay.

Founded in December 2015 by Sameer Nigam, Rahul Chari, and Burzin Engineer, PhonePe offers financial services to users, including mutual funds and insurance products on the platform. It competes with publicly listed Paytm and Google Pay in India's digital payments space.

PhonePe was acquired by the Flipkart Group in 2016. The company claims to have more than 400 million registered users and over 35 million offline merchants spread across India, covering 99% of PIN codes. With the recent investment, PhonePe aims to continue its growth trajectory and cement its position as a leader in India's digital payments market.

Which Other Indian Startups Has General Atlantic Invested In?

General Atlantic, the global growth equity firm, has been increasing its investments in Indian startups in recent years. With a focus on technology, healthcare, and financial services, General Atlantic has been attracted to India's rapidly growing market and young, tech-savvy population. 

Some of General Atlantic's recent investments in Indian startups are – 

General Atlantic first invested in edtech startup Byju's in 2018 and has since increased its stake in the company, 

The company led a USD 50 million investment round in NoBroker in 2019, and the company has since raised additional funding from other investors.

General Atlantic invested in edtech startup Unacademy in 2020 as part of a USD 150 million funding round and in 2021, Unacademy raised another USD 440 million in funding at a valuation of USD 3.44 billion.

It has also invested USD 100 million in beauty and wellness e-commerce platform Nykaa in 2020.

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