Nearly three months after Paytm was reported to be in talks to acquire Bengaluru-based O2O deals platforms Little and Gurugram-based Nearbuy, the digital wallet company has finally taken over the two companies. As per a media report, in a statement, Paytm said it arranged a merger of the two startups and made a strategic investment in the resultant entity for a majority stake.
Vijay Shekhar Sharma, founder and CEO of Paytm stated, “This combination of Nearbuy and Little marks a great opportunity for us to reinforce our commitment to support small and large retailers in the new age of mobile commerce and payments. I am sure consumers will love the greater selection and reach of everyday deals and discount offers.”
Little was founded by Manish Chopra and Satish Mani, the entrepreneurs behind the online fashion brand Zovi. It is an app-only marketplace for deals in the O2O space. Little has over 25,000 merchants present in 17 cities offering 50,000+ live deals across F&B, movies, last-minute hotels, health and wellness, etc. The startup raised $50 Mn from Paytm, SAIF Partners and Tiger Global Management. However Paytm did not clarify if it bought out SAIF and Tiger’s stake in Little.
Related Article: Paytm Looks To Acquire Deals Platform Little And Nearbuy
Nearbuy, which was previously known as Groupon India, came into existence after Groupon acquired SoSasta in 2011 to enter the Indian market. Post the exit of the founders of SoSasta, Ankur Warikoo took over as the CEO of the company (called as Groupon India at the time). It was in August 2015 that Groupon India was rebranded to Nearbuy, following the management buyout wherein Sequoia invested $17 Mn.
Paytm And Its Quest To Be More Than A Digital Wallet Company
With these acquisitions, Paytm is set to benefit from the large number of merchant partnerships of both Nearbuy and Little. The company also plans to cross-sell deals by Paytm merchants on the two platforms. Additionally, Paytm’s strategic holding in the merged entity will allow its merchant partners the opportunity to offer deals to acquire new customers, thus adding further to its overall consumer base.
The acquisitions are in line with its strategy of becoming more than a digital wallet and expanding the categories in which its digital payments services are being used. Some of its recent acquisitions toe a similar line. For instance, in July it acquired a majority stake in ticketing platform Insider.in to bump up event listings and have more users book events through Paytm, thus challenging the market leader BookMyShow. In the same month it also invested in MobiQuest’s loyalty platform m’loyal.
Post the massive $1.4 Bn funding from SoftBank, Paytm is currently valued at $9 Bn. Its current ecosystem spans use-cases including peer-to-peer payments, utility bill payments, travel bookings, hotels, movies and events, and ecommerce. The launch of WhatsApp like messaging service Inbox, initiatives to set up a money market fund, partnership with PVR, and more clearly indicate the aggressiveness with which Paytm is trying to branch into different domains.
Earlier this month it has made an undisclosed amount of investment in Mumbai-based fintech startup CreditMate. CreditMate is an online lending platform focussed on the used two-wheeler market in India. Paytm aims to utilise CreditMate’s proprietary credit and asset valuation technology. It also tied up with ICICI Bank to launch a short-term, interest-free credit line aptly called Paytm-ICICI Bank Postpaid. Thus the acquisition of Little and Nearbuy is yet another move to empower the deals offerings of Paytm, allowing it to further increase the breadth of its offerings.
[The development was first reported by LiveMint]