Khatabook Raises $100 Mn; Will Buyback ESOP Worth $10 Mn

MS Dhoni-backed Khatabook has raised $100 Mn in its Series C round. The fresh round of funding was led by US-based VC firms Tribe Capital and  Moore Strategic Ventures (MSV), along with participation from Alkeon Capital, Sequoia Capital, Tencent, RTP Ventures, Unilever Ventures, Better Capital, and others. With this investment, the startup is now valued at $600 Mn. The startup will utilise the new investment to build financial services, hire talent in engineering, product, design, analytics, and data science functions. 

The fintech startup will also be buying back $10 Mn worth of ESOPs to reward employees, former employees, and early investors. As per Khatabook, eligible employees will be able to sell as much as 30% of their vested options. The startup has also expanded its ESOP pool to $50 Mn.

Originally built by Vaibhav Kalpe and later acquired by Kyte Technologies in 2018, Khatabook is a fintech startup that helps small shopkeepers and kirana store owners manage their accounts and keep track of the money owed to them through a digital ledger. Kalpe had later joined the Kyte team, which included founding members like Ravish Naresh, Jaideep Poonia, Dhanesh Kumar, and Ashish Sonone. At present, Naresh is the chief executive officer and cofounder of Khatabook.

Khatabook boasts of more than 10 Mn active users, and helps merchants manage over 264 Mn customers across India. Khatabook claims to have reached 95% of India’s districts where it is empowering shopkeepers. The fresh investment comes months after Khatabook launched Cashbook, which helps users manage their expenses. 

It had raised its Series B round last year in May, a time when India was struggling with the first wave of the pandemic. It had then bagged $60 Mn that was led by B Capital, an investment firm founded by Facebook cofounder Eduardo Saverin. Sequoia Capital, Partners of DST Global, Tencent, GGV Capital, and others participated in the round. The said investment had valued the startup somewhere between $275 Mn to $300 Mn. Prior to this, Khatabook raised $25 Mn in Series A in 2019. The round saw participation from GGV Capital, Partners of DST Global, RTP Ventures, Sequoia India, Tencent, Y Combinator and others. Khatabook has also acquired Biz Analyst, a business management application for $10 Mn earlier this year. Khatabook at this point competes against the likes of OkCredit, Pagarbook, Paytm’s Business Khata, and others.