Delhi-headquartered digital gold loans startup Rupeek has raised $60 Mn in Series C funding round, Sumit Maniyar, CEO, Rupeek told Inc42. The investors in the round include investors such as GGV Capital, Bertelsmann India Investments, Binny Bansal, KB Investments Co (KBIC), Tanglin Venture Partners, Sequoia India and Accel Partners.
In August 2019, Rupeek was said to have raised $30 Mn from Bertelsmann India Investments and existing investors. Maniyar explained that it was the Series C round of which a part had come in then, and another part of $36 Mn came in recently on a different valuation.
Maniyar said that the funds will be used to invest in technology and customer acquisition. Hans Tung, managing partner at GGV Capital, has joined Rupeek as a board of director.
Founded by Maniyar and Ashwin Soni in 2015, Rupeek aims to bring transparency in the gold loans lending space and monetise India’s idle gold. This will generate liquidity which in turn will increase economic activity, according to the company. To enable lending, Rupeek has partnered with banks such as the Federal Bank and Karur Vysya Bank. The company claims to offer a 30 minutes doorstep service for gold loans, on-demand pickup and return of the valuables.
Binny Bansal, cofounder, Flipkart and Xto10X Technologies said, “Their strong customer proposition and approach of partnering with banks is truly a game-changer for the unorganized gold loans space in India.”
Maniyar told us that Rupeek has a $28 Mn monthly run rate in terms of loan disbursement. It also claims to see monthly growth of 20%. The company claims to disburse gold loans at an annual run rate of more than $200 Mn.
Even though the company hasn’t achieved breakeven yet, Maniyar said that the coming fiscal, profitability will be the main focus. “We at least want to be profitable on the quarterly economics level,” Maniyar added.
Anand Daniel, partner, Accel Partners said, “Rupeek has identified a key problem of availability and accessibility to credit to the self-employed sector in a market like India. The amount of stationary gold in India opens up the opportunity in terms of monetisation and distribution.”
Maniyar said that the company’s plan is to scale existing and newer channels for gold monetization. The company spokesperson told us that the company plans to expand to 100 cities by 2022, from the existing 10 cities. The company is looking to expand into cities in Western and Southern India.
GV Ravishankar, managing director, Sequoia Capital India LLP said, “They’ve demonstrated how young companies can successfully leverage the capital advantage of banks to open up market opportunities that are currently underserved – creating a winning proposition for its banking partners to gain share in the gold loan market.”
In terms of further expansion into international waters, Maniyar told us that even though the company has received inbound interest, they are not planning to go out of India anytime soon as it is a huge market itself.
“India is known to have the world’s largest private gold holdings followed by China and the US. Furthermore, the underlying market demand coupled with Rupeek’s large scale disruption has given rise to the accelerated growth of company’s loan disbursals,” said, Chunsoo Kim, executive managing director (head of Global Investment Group) at KB Investment.
The gold loan space has mostly been dominated by Non-banking financial institutions (NBFC’s) like Muthoot Finance and Manappuram Finance. However, in the past few years, multiple fintech majors have forayed into the gold lending and investments space including Paytm, PhonePe, and Google Pay.
Talking about the competition, Maniyar said that the bigger players are not in the same space as Rupeek as they focus on digital gold while Rupeek is focused on physical gold. “We may look at synergies with them, instead of seeing them as competition,” Maniyar added.
Update: February 25, 2020| 19: 45 PM
The funding amount and the headline have been updated to clarify that it is a Series C round for Rupeek. An initial email from the company had mistakenly referred it to as Series B. Rupeek founder clarified the amount and round in a telephonic interview with Inc42.