bansal: Scoop: Flipkart co-founder Binny Bansal wants to fund PhonePe with $100-150 million investment

Flipkart co-founder Binny Bansal is in talks to invest around $100 million to $150 million in PhonePe as part of an ongoing funding round at the digital payments company, people familiar with the matter said. The transaction, if successful, will be among the largest single investments in a new-age company, similar to the $100 million bet Flipkart co-founder Sachin Bansal made in Ola in 2018.

“The amount invested by him (Binny Bansal) is yet to be determined. Talks are ongoing and likely to conclude soon,” said a person familiar with the discussions.

In this current funding round, PhoneP has already raised close to $450 million in primary capital from PE major General Atlantic, Tiger Global, Ribbit Capital, among others, worth $12 billion. Some of Flipkart’s existing shareholders such as Bansal, Tiger Global, China’s Tencent, Qatar Investment Authority and Microsoft are expected to buy new stake in PhonePe as the company has set up a new ownership structure.

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

PhonePe is India’s dominant Unified Payments Interface (UPI) online payment application and handles about four billion transactions a month, Walmart International President and CEO Judith McKenna said last month. At the end of 2022, total payment volume (TPV) reached $950 billion, he said.

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

ET reported on November 25 that PhonePe was in the final stages of talks to buy buy-to-let (BNPL) startup ZestMoney as it looks to monetize through financial services. Bansal, who was instrumental in Flipkart’s acquisition of PhonePe in 2016, had already remained on the board and was closely associated with the company’s founders, Sameer Nigam and Rahul Chari.

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

The deal is significant as it comes at a time when the entire tech industry is facing a long-term slowdown in funding activity.

More money for Curefoods

In addition to PhonePe, Bansal has also invested in cloud kitchen platform Curefoods, which was spun off from Cultfit, founded by Mukesh Bansal and Ankit Nagori in 2016. Cultfit bought secondary shares in Curefoods, three people familiar with the matter said. with the negotiations of the bargain. According to the sources, Bansal’s ownership stake in Curefoods increased from less than 5% to 12-13% with the $25-30 million investment.

Ankit Nagori, Co-Founder of Curefoods

“After Mukesh Bansal and Nagori parted ways and Curefoods was formed separately in 2021, Binny Bansal funded the platform… He is now doubling his stake by increasing his stake,” said another person familiar with the situation.

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

Email queries sent by ET to Bansal and spokespersons for PhonePe and Curefoods went unanswered till press time on Thursday.

Bansal’s investment vehicles

The entrepreneur-turned-investor is not only an angel and initial supporter of Indian startups, but has also distinguished himself by raising funds in the later stages. And ET has several people familiar with Bansal’s thinking who hold positions at companies like PhonePe and Curefoods.

It manages its startup investments 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; and 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, lending platform Rupeek, among the 80 companies he has backed, according to research firm Tracxn.

In 2019, Bansal planned to launch a venture capital fund. However, the plan did not materialize, and since then he has been supporting start-ups with his personal capital.

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

Bansal made concentrated bets where he cut bigger checks on more mature companies, another person familiar with his strategy said.

“He has been spending more time in India in the last few quarters and has been visiting Bangalore frequently,” said a person on condition of anonymity.

“In addition to his investments, he spends more time at xto10x. They are also considering investing in startups through xto10x,” said a person familiar with the matter.