IndiaMART has invested in Bengaluru-based business accounting startup Vyapar’s Series A round. IndiaMART MD Dinesh Agarwal told Inc42 that the Noida-headquartered B2B ecommerce marketplace has invested in the accounting software startup. The investment finds relevance as it is one of the first investments of IndiaMART after going public in June 2019.
Simply Vyapar Apps has raised INR 36 Cr ($4.97 Mn) Series A funding led by the B2B marketplace with participation from existing investors India Quotient and Axilor Ventures. Of this, INR 30.12 Cr ($4.16 Mn) has been invested by IndiaMART for a minor stake. The company plans to use the fresh funds primarily for growing customer base and building the next set of major functionalities to provide complete business solution for MSMEs.
“We also plan to solve for manufacturing sector, another unorganized and non-digitized segment which is major contributor of the economy,” said, Sumit Agarwal, founder, Vyapar.
How Does Vyapar Fit Into IndiaMART’s Plans?
Founded in 2016 by Sumit Agarwal, Vyapar provides business accounting software (a mobile app as well as desktop versions) with billing, GST invoice, stock inventory and accounting solutions for small businesses.
It claims to have over 1 Mn downloads and helps small and medium businesses manage billing for GST invoices, stock inventory and accounting work. Dinesh Agarwal told Inc42 that the investment is a good strategic fit for IndiaMART’s long-term objective of venturing into the fintech and SaaS space. “Vyapar is a SaaS cum fintech opportunity it fits perfectly into our investment and expansion plan,” he added.
The company has a turnover of INR 1.4 Cr for FY 2018-19 with an emloyee base of 50. Vyapar founder Agarwal said the company’s vision is to digitise every business in India and simplify processes. “IndiaMART’s scale and expertise will help us achieve this goal faster, in turn, transforming the MSME landscape in India,” he added.
Asutosh Upadhyay, who led the investment at Axilor, said, “Vyapar proves that the right business model can breakthrough an otherwise traditional sector. Their laser-sharp customer focus along with IndiaMART’s expertise in the sector will help them achieve a larger scale in India’s MSME segment.”
Dinesh Agarwal told us that there is nearly 20% overlap in the users of IndiaMART and Vyapar, and going forward, they will examine to find the best possible use for such overlap. He also emphasised that Vyapar today has half a million monthly active users, and has been competing based on its mobile-first competency against players such as Zoho etc.
Vyapar competes with the likes of ClearTax, SahiGST etc in the fintech segment, which is touted to be worth $1.4 Bn. The sector has been seeing influx of funds from marquee investors with the continued investments towards reaching the unbanked population of the country. Between 2015 and Q1 2019, the total investment in Indian fintech startups was $7.62 Bn according to DataLabs by Inc42.
IndiaMART: Life After Going Public
Vyapar is not the first investment by IndiaMART. Dinesh Agarwal has personally invested in more than 35 startups including Little Eye Labs, which was acquired by Facebook. IndiaMART has invested in Noida-based event discovery platform 10times and Delhi-based B2B ecommerce marketplace Procmart.
Incorporated in 1999 by Brijesh Agrawal and Dinesh Chandra Agarwal, IndiaMART InterMESH Limited is an online B2B marketplace to deal with business products and services. It is an online platform for business buyers to connect with suppliers of the products and services.
As of March 31 this year, IndiaMART had 82.7 Mn registered buyers and 5.55 Mn supplier storefronts in India, with 60.73 Mn SKUs listed of which 76% comprised products and 24% were services.
In June 2019, IndiaMART went public by listing on BSE and NSE. The company’s closing day of bids for its IPO was oversubscribed by 36 times. With 16.2% CAGR rise in paying supplier base and 10.3% CAGR rise in average realisation towards each paying suppliers, IndiaMART reported a 26.4% CAGR rise in consolidated operating revenue over FY17-19 to INR 507. 42 Cr in FY19.