Fintech Startup M2P’s FY22 Loss Widens Over 6X To INR 41 Cr, Revenue Rises To INR 203 Cr

SUMMARY

The Tiger Global-backed startup’s net loss jumped from INR 6.5 Cr in FY21 as its cash burn rose with the growth in business in FY22

M2P Fintech’s revenue from operations jumped 4.6X to INR 194 Cr from INR 41.8 Cr in FY21

M2P’s EBITDA margin contracted to -18.7% in FY22 from -13.8% in FY21

Chennai-based fintech startup M2P Fintech’s net loss surged 6.2X to INR 40.9 Cr in the financial year 2021-22 (FY22) from INR 6.5 Cr in the previous year as its cash burn rose with the growth in its business.

M2P’s revenue from operations jumped 4.6X to INR 194 Cr from INR 41.8 Cr in FY21. The soonicorn startup earns revenue mainly from API services, payment infrastructure contracts, and card processing services.

Including other income, the startup’s total income rose 4.5X to INR 202.6 Cr from INR 44.3 Cr in FY21.

With the increase in revenue, total expenses also surged 4.7X to INR 243.4 Cr from INR 51.02 Cr in FY21. Cost of material consumed, including technology and cost of software development, accounted for over 68% of the total expenditure.

M2P spent INR 167.4 Cr on cost of material consumed, a jump of 485% from INR 28.5 Cr in the previous fiscal year.

Employee benefit expenses rose to INR 57.9 Cr in FY22, an increase of 237% from INR 17.2 Cr in the previous year. The startup’s EBITDA margin contracted to -18.7% from -13.8% in FY21.

Founded in 2014 by Muthukumar A, Prabhu R and Madhusudanan R, M2P offers fintech API solutions to its clients such as slice, CRED, Ola, and Razorpay. The startup offers a wide range of solutions across payments, lending, and banking. Besides India, it also has presence in the UAE, Egypt, Indonesia, and Philippines, among others.

M2P raised funding across two rounds in FY22. In October 2021, it raised $35 Mn in its Series C round from Tiger Global. In January 2022, it raised another $56 Mn from Insights Partners at a valuation of $600 Mn.

The fintech startup also added American multinational financial service provider Visa to its cap table in September last year.

M2P had also been on an acquisition spree, making its fifth acquisition by buying Syntizen for an undisclosed amount in July last year. Prior to that, it acquired credit card sourcing startup Wizi, SaaS startup Origa and banking solution provider BSG ITSOFT in 2022.

M2P competes against the likes of Setu, which has been acquired by Pine Labs, and Decentro.