Despite the doubts surrounding private technology valuations and the impact of a probable downturn in funding, some deals continue to happen. One such platform in talks about potential funding is CredAvenue. Online Platform, CreadAvenue is contemplating raising funding worth $150 billion dollars in a Series B round which will value it over a billion dollars. As per sources close to the matter, this can be seen as a rather aggressive valuation given the fact that a broader selloff is taking place in technology stocks.
The What and Why
Crucial discussions are being held by investors who are contemplating leading the funding round. This includes Insight Partners, one of the world’s biggest investors in tech, in addition to Tiger Global Management. CredAvenue’s first funding round took place in the month of September last year during which it was valued at $400 million. In addition to Insight Partners and Tiger Global Management, Sequoia and Lightspeed, the existing investors, will also take part in the funding round.
CredAvenue led by Gaurav Kumar is a branch of Vivriti Capital. It works to create connections between the bank and non-bank lenders so that they can co-lend. In addition to this, the online platform also provides asset-backed loans, and debts through bonds or supply chain finance. CredAvenue has to its credit the running of transactions worth a whopping Rs.85,000 crores, and it boasts of having over 500 lenders on its platform. Another highlight of CredAvenue is that its borrowers are provided with an API aka Application Program Interface plug-in while the lenders are provided with underwriting services.
As per sources close to the matter, the annualized revenue of CredAvenue touches $25-30 million which amounts to a monthly revenue of $2.5 million. This would mean that the current funding round if it happens, will see a valuation that will be almost 40 times the revenue, a higher figure particularly in the context of an evident stock collapse of other listed software and fintech companies.
As of now, there haven’t been any comments from either Tiger Global or Insight Partners, and Gaurav Kumar has completely denied any such development or discussion. If they follow through with the deal, CredAvenue will hold the ‘unicorn’ label, thereby joining the seven other unicorns produced by India in 2022.
