B2B commerce marketplace — OfBusiness — is the new entrant to the celebrated unicorn club of the Indian startup ecosystem. The Gurugram-based startup received fresh funding worth $160 Mn led by Japan’s SoftBank Vision Fund-II. The round valued the startup at around $1.5 Bn. While the Masayoshi Son-led SoftBank has pumped in $150 Mn, Falcon Edge, Matrix Partners invested the remaining amount.
The startup will be utilising the fresh capital for acquisitions and strategic investments to augment its grip over the supply chain of petrochemicals, metal, plastics, food grains, among others.
Founded in 2016 by Bhuvan Gupta, Vasant Sridhar, Ruchi Kalra, Nitin Jain, and Asish Mohapatra, the tech-enabled platform facilitates raw material procurement and credit for SMEs in the manufacturing and infrastructure sectors. The startup integrates technology to SMEs buying behaviour to make available better products, at better prices, in better timelines to customers with a comprehensive online and offline support.
Few of the key raw materials that OfBusiness focuses on are metals, chemicals, polymers, agri commodities, petrochemicals, and building materials. The startup enables SMEs access to cash flow-based financing for buying raw materials through its NBFC — Oxyzo Financial Services. Oxyzo has a loan book of $220 Mn that is growing at 80% year-on-year. The statup’s financial services has around 45 lenders across leading banks and NBFCs.
The startup has also build two SaaS products that help to increase scale Bidassist and SME Assist. Bidassist has now moved international with the sourcing of global tenders for Indian companies. OfBusiness said that its SaaS products are growing at 2x year-on-year and are independently profitable.
Commenting on the investment, Sumer Juneja, partner at SoftBank Investment Advisers, said, “The 60M+ SMEs in India are underserved by the existing offline supply and finance chain. OfBusiness has successfully built a full-stack solution enabling commerce and financing through a single marketplace which is digitizing the SMEs.”
Ofbusiness competes against the recently turned unicorn Moglix. Rahul Garg-led startup bagged $120 Mn from Falcon Edge Capital and Harvard Management along with participation from existing investors Tiger Global, Sequoia Capital India, and Venture Highway in May this year. It also competes with Zetwerk, which raised $120 Mn in a Series D funding round earlier this year led by US-based Greenoaks Capital and Lightspeed Venture Partners. Other players in the B2B ecommerce segment include IndustryBuying, IndiaMart.
Incorporated as OFB Tech Private Limited, OfBusiness bagged its Series A round led by Matrix Partners worth $5 Mn. Back then Patni Group’s Apoorva Patni, OLA’s Bhavish Aggarwal, Quikr’s Pranay Chulet, also participated among others. In 2017, the startup bagged INR 75 Cr in its Series B round led by Zodius Capital. In June 2018, the startup crossed INR 100 Cr in terms of revenue and later went on to raise Series C funding worth $29.2 Mn from Creation Investment and Falcon Edge.
In 2019, the startup received funding worth $34 Mn in its Series D round led by Norwest. The startup which has been profitable for the past three years closed its Series D2 funding round through its parent entity OFB Tech from Falcon Edge Capital. OfBusiness raised the funds at a valuation of $800 Mn.
This means that the latest capital infusion has almost doubled its valuation to $1.5 Bn in just two months. The startup is the 17th entrant to the unicorn club and third in July after Droom and Blackbuck received an investment worth $200 Mn and $67 Mn respectively.