Paytm Seeks $500 Mn Funding From Alibaba & Temasek Holding

Paytm, mobile ecommerce startup is foreseeing Chinese ecommerce counterpart Alibaba and Singapore based Temasek Holdings to invest more than $500 Mn  in the mobile ecommerce company. The investors together will hold 25-30% stake in the company valuing $1.5-1.9 Bn.

Alibaba and Temasek have bid for a stake in the One97, Communications-owned company, which has grown manifold since its launch in 2011.

Existing investor SAIF Partners also seem to participate in this round of funding to keep its 40% equity stake, while Vijay Shekhar Sharma, chairman and managing director of One97 Communications, will dilute his stake in favour of new investors. Amazon and Tiger Global are not sure to participate in this funding round though  they have shown interest in Paytm.

This deal will be the biggest fund raising exercise by the Indian startup surpassing the $1 Bn valuation mark. The amount will be used to strengthen mobile operations and adding customers.

Founded in 2011 the company offers mobile recharges, tickets and deals, besides clothing, shoes and accessories via an integrated marketplace. It also functions as a mobile wallet, allowing users to store cash that can be used to pay for various services. Paytm was among the first ecommerce companies to move to a mobile-first strategy from an exclusively computer-based one, which is why it’s so attractive to investors.

Paytm had announced its plans to foray into international markets, with pilot countries being Singapore and other South East Asian markets. It appointed crowd-funding website Milaap’s founder Sourabh Sharma to establish its presence in these geographies.