neobank Open, gets $100 million in a round-headed by Google, Temasek, Visa, and SoftBank Investments of Japan
Open is valued at $500 million in this round of investment, putting the firm on track to become a unicorn within the next year. Open may explore raising further cash in the next six months, according to Moneycontrol.
Open, a neobank, has secured $100 million in its Series C round of investment, according to a source familiar with the matter. Google, Temasek, Visa, and Japan’s SoftBank Investments sponsored the round, which valued the firm at $500 million. Tiger Global and 3one4 Capital, both existing investors, also participated in the round.
Anish Achutan, Ajeesh Achutan, Mabel Chacko, and Deena Jacob founded Open in 2017 to provide a business current account to small and medium-sized enterprises. Digital banking, payments, invoicing, and automated bookkeeping are all included in the account.
The funds will be used to enhance and accelerate the company’s new product lines, including Zwitch, an embedded finance platform, and BankingStack, a cloud native SME banking platform for financial institutions that is presently used by over 15 Indian banks.
Over the following year, Open plans to grow its customer base to five million SMEs and expand into new areas such as Southeast Asia, Europe, and the United States.
On this transaction, Avendus Capital served as Open’s only financial advisor.
With its next funding round, which is expected to conclude in the next six months, the firm hopes to become a unicorn and acquire a valuation of over $1 billion. A unicorn is a privately backed firm having a market capitalization of at least $1 billion.
In the next months, the Bengaluru-based firm is in negotiations with major investors for an intermediate level or a Series D investment.
Players like Khatabook and Razorpay are currently boosting up their products in the neo bank market, resulting in fierce rivalry. Open is aiming for unicorn status as soon as possible in order to preserve its competitive advantage and continue drawing large investments in the future.
Razorpay, which is valued at $3 billion, is expanding its neo banking platform RazorpayX, while Khatabook, which is valued at $600 million, just received $100 million. New entrants trying to create models comparable to Open will increase competition in the market.
BEENEXT, AngelList, Tanglin Investment Partners, Unicorn India Ventures, Speedinvest, and Recruit Strategic Partners are among the other investors in Open.
After Glance and DailyHunt in December 2020, and the purchase of social commerce player Simsim through YouTube this year, this is Google’s fourth investment in the Indian startup industry. Google has pledged a $10 million investment in India’s IT sector.