Softbank Likely To Infuse $1.9 Bn In Paytm; Will Value Company At $9 Bn

Japan’s SoftBank, led by Masayoshi Son is likely to back Paytm, in what apperas to be one of the biggest deals in the digital ecommerce space. Softbank has already invested $2 Bn in its major stake holding companies like Snapdeal, Ola, Housing, Freecharge, Grofers, and OYO.

As reported by ET, Softbank will be investing $1.9 Bn in Paytm, at a valuation of $9 Bn. Earlier this month, Inc42 also reported about Paytm’s plans to raise $1.5 Bn in an all cash deal. In August 2016, Paytm raised its last funding round of $60 Mn (a speculated amount) which valued the company at somewhere around $4.8 Bn. In March 2017, Paytm’s ecommerce marketplace Paytm E-Commerce Pvt. Ltd also raised $200 Mn from Alibaba and SAIF Partners.

An email send to Paytm did not elicit any response at the time of publication.

2016 was a year of accomplishments for Paytm on all fronts and this continued with the new financial year FY17-18.

In August 2016, after securing a $60 Mn funding round, One97 Communications, which runs Paytm, created a separate entity called Paytm E-Commerce Pvt. Ltd and transferred its online retail business onto it. Paytm’s founder Vijay Shekhar Sharma had also announced plans to invest $120 Mn-$149 Mn in developing the new entity.

Paytm also made a major move towards capturing more Indian ecommerce customers by announcing the launch of Paytm Mall – closely modelled after Tmall, the Alibaba-owned marketplace B2C retail ecommerce play in China.

Here, have a look at Paytm’s major announcements in 2017:

April 2017

• It launched a food wallet to provide tax saving opportunities for corporate employees,
• It invested an undisclosed amount in AI and big data-riven healthtech startup QorQL.
• Paytm Mall launched O2O Commerce with an aim to partner with the large offline merchant network of Paytm. Also, plans to adopt QR code technology to bring efficiency in product discovery and supply chain.
• Paytm CEO Vijay Shekhar Sharma made it to the TIME’s 100 most influential people list 2017 along with PM Narendra Modi.
• Also, forged partnerships with international luxury brands to accept Paytm as a payment mode and recently integrated Paytm’s payment gateway to IRCTC’s app.

March 2017

• Vijay Shekhar Sharma debuted on the Forbes Billionaire list with a net worth of $1.3 Bn.

• Paytm employees sold their shares in Paytm’s parent company One97 Communications. About 47 employees reportedly sold shares worth about $15.3 Mn (INR 100 Cr) to both internal and external buyers.
• It partnered with Booking.com. The partnership will facilitate accommodation bookings on its online travel marketplace.
• It launched it payments app in Canada.

February 2017

• Invests in Y Combinator alum Innov8 along with Rajan Anandan, VP Google of Southeast Asia and India, LetsVenture and others.

After persistent attempts to sell off Snapdeal and FreeCharge, SoftBank is now betting majorly  on budget accommodation and digital payments space – the two hottest segments in the Indian consumer Internet space at the moment. As per media reports, Softbank recently also announced to invest $250 Mn in OYO Rooms at a valuation of $850 Mn against a 42% ownership in the company, from its current 27% stake.