OPEN Spent INR 195 Cr To Earn INR 25 Cr Revenue In FY24

Bengaluru-based OPEN seems to be struggling to scale up its operations. The neobanking startup’s operating revenue declined 17% to INR 24.8 Cr in the financial year 2023-24 (FY24) from INR 29.9 Cr in FY23.

Founded in 2017 by Jacob, Anish Achuthan, Ajeesh Achuthan, and Mabel Chacko, OPEN offers business banking, payments and expense management solutions to small and medium businesses (SMBs) across the country. It has three major products – OPEN Flo, OPEN Settl and OPEN Capital.

OPEN earns a majority of its revenue from the sale of services. The unicorn breaks down its revenue from operations into two major categories – subscription revenue and commission on services.

Including other income, the startup’s total revenue declined 13% to INR 46.1 Cr from INR 53.1 Cr in FY23. 

With the decline in revenue, the Temasek-backed startup’s net loss also reduced 30% to INR 170 Cr during the year under review from INR 242.2 Cr in the previous fiscal year.

Where Did OPEN Spend?

The startup’s total expenditure dropped 34% to INR 194.6 Cr in FY24 from INR 296.5 Cr in FY23. 

Employee Benefit Expenditure: Despite a 22% year-on-year decline, employee cost was the biggest expenditure for the startup. It spent INR 117 Cr under the head in FY24 as against INR 149 Cr in the previous fiscal year. 

Information Technology Expense: Information technology cost stood at INR 23.8 Cr in FY24, a decline of 16% from INR 28.5 Cr in FY23. 

Advertising Expenditure: The startup slashed its advertising expenditure by a whopping 85% to INR 8.8 Cr from INR 57.6 Cr in FY23. 

Despite the decline in total expenses, OPEN spent INR 7.84 to earn every rupee from operations. OPEN currently claims to process over $30 Bn in annualised transactions. 

In December last year, the startup received the final approval from the Reserve Bank of India (RBI) to operate as a payment aggregator. 

OPEN entered the unicorn club in May 2022 after raising $50 Mn from existing investor IIFL. The startup has raised a total funding of $190 Mn till date. It counts Temasek, 3one4 Capital, SBI Investment, and Tiger Global among its backers. 

It competes against the likes of Oxyzo, Yubi, and Navi.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.