HDFC Participates In Investment Tech Startup smallcase’s $14 Mn Round

Indian private sector bank HDFC Bank has participated in smallcase’s Series B funding round by acquiring a minority stake in the company. The Bengaluru-based investment tech startup had announced the $14 Mn fundraise for this round back in September.

DSP Asset Management Firm, Sequoia’s SCI Investment V, Milestone Trusteeship Services, BEENEXT, and Unitary Funds had participated in this Series B round. Other investors Relativity Investment Advisors’ Nakul Zaveri, Universal Trustees Private, Chanakya Value Creation, QED Innovations Lab and AIB’s Tanmay Bhat also joined in as investors.

According to the ministry of corporate affairs filings, smallcase has allocated 55 equity shares at a face value of INR 10 and a premium of INR 96,295 per share, 4,961 Series B Compulsory Convertible Preference Shares (CCPS) and 5,266 Series B1 CCPS of the face value of INR 50 and premium of INR 96,255 per share.

smallcase plans to use this funding to enhance product suite, technology infrastructure and team expansion. It had raised  $8 Mn Series A funding led by Sequoia India, with participation from existing investors — Blume Ventures, Straddle Capital, Beenext Pte Ltd, WEH Ventures and DSP Adiko.

Commenting on the latest round, HDFC Bank’s Smita Bhagat, country head of government and institutional business, ecommerce and startups, said, “HDFC Bank, over the past few years, has been working closely with the startup and fintech ecosystem in India in various ways. This ecosystem, we believe, will play an important role in the economic progress of the country. With a unique model, smallcase is well positioned to create a niche in the capital markets in India and also help expand the market.”

Launched in 2016 by Vasanth Kamath, Rohan Gupta and Anugrah Shrivastava, the Bengaluru-based startup provides users with a professionally built basket of stocks called ‘smallcases’, allowing them to invest in portfolios of broker-partner stocks and exchange-traded funds (ETFs) using their personal existing demat accounts. It works with more than 100 stockbrokers like HDFC Securities, Zerodha, AxisDirect, Edelweiss and 5Paisa. The company has about 2 Mn individual investors on its platform.

With the secularly growing interest and participation in equity markets, smallcase claims to have seen a sharp increase in its investor base and amounts transacted over the last six months with its ecosystem approach.

“As financial literacy and equity penetration grows in India, smallcase is positioned very strategically to capture a dominant share of this shift,” smallcase founder and CFO Vasanth Kamath said.