(Bloomberg) — Debt marketplace CredAvenue Pvt. became India’s latest unicorn after raising $137 million in a round led by Insight Partners, B Capital Group and Dragoneer.
The valuation of the Chennai-headquartered fintech, which connects enterprises with lenders and investors, rose to $1.3 billion from $410 million in September. That makes it India’s fastest fintech unicorn – — privately-backed startups valued over $1 billion — within 18 months of being established, CredAvenue said in a statement.
The Sequoia Capital and Lightspeed Ventures-backed startup specializes in providing digital technology solutions for all stages of the debt cycle, from disbursal to collections. Existing investors also participated in the round.
A surge in financing focused on Indian e-commerce and technology companies led to a unicorn-making spree last year, and continue investments by venture capital firms suggest the streak is spilling into 2022.
CredAvenue plans to use the funds to expand in India and into key global markets as well as make acquisitions. It recently bought Spocto, which specializes in technology to support collections.
“India’s debt market will go into hyper-growth mode over the next week years, provided digital debt infrastructure supports the growth,” founder and Chief Executive Officer Gaurav Kumar said in an online interview from Chennai. “It’s the equivalent of the boom in India’s equity markets in the 1990s.”
Kumar, 39, founded CredAvenue in late 2020. After graduating from the country’s foremost rural management institute, he worked overseas briefly before turning into a serial entrepreneur. CredAvenue is his fourth venture.
“Debt in India is still under-penetrated” as a percentage of GDP at about 60%, said Kabir Narang, founding general partner at B Capital Group. At $1.9 trillion, the Indian debt market is still underserved, he said, adding that it “creates a massive opportunity.”
CredAvenue has surpassed $12 billion in gross transactions on its marketplace and has over 2,300 enterprise customers, and more than 750 lenders. Spocto is in the Middle East market and will target the U.S. market. CredAvenue intends to expand domestically for the next couple of years, Kumar said.
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