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RupeePower Founder Gets Company’s Control In Buyback From Snapdeal

RupeePower Founder Gets Company’s Control In Buyback From Snapdeal

In a recent buyback, Tejasvi Mohanram, founder of the online consumer and SME credit platform RupeePower took back the reins of the company from online marketplace Snapdeal. The terms of the transaction weren’t disclosed.

Founded in May 2012, this Gurgaon -based startup has more than 15 partners, 67 products and provides services in more than 490 cities. It matches borrowers and lenders in the retail loans space. The customers are provided with the loan and card offers for comparison and matched with the bank’s criteria. The service is free for the customers. Upon loan disbursal, the company gets paid by the financial institution.

Customers can compare personalised loan/card offers from over 15 lenders, apply online and get an instant in-principle approval. On the other hand, lenders can access the company’s omni-channel customer acquisition, decisioning and underwriting platforms.

Jasper Infotech is now a minority shareholder in RupeePower. The decision regarding the buyback happened due to lack of funds in the market. RupeePower will raise its capital independently.

Snapdeal acquired a majority stake in RupeePower in March 2015. According to ET, Snapdeal had acquired a 60 per cent stake for $2.24 Mn(INR 15 Cr). Snapdeal’s act of stepping out comes as it integrates efforts with digital payments platform and wallet Freecharge.

Talking about the buyback Tejasvi Mohanram said, “Snapdeal is a minority shareholder now; the founders are in majority. Besides Snapdeal, the opportunity that we see is (working) across multiple ecommerce platforms. The story for us is much larger than working with just one ecommerce player and providing loans to its customers and sellers.” This statement indicates that it plans to work with rivals like Flipkart too.

A spokesperson from Snapdeal said “We periodically evaluate our portfolio investments to determine continued alignment with business needs. As part of this exercise, we have reduced our stake in RupeePower as our investment objectives in the same are substantially achieved.”

The company is now looking to raise another round from venture capital investors. It claims to have served over $1 Bn(INR 7000 Cr) to 175,000 + customers.

Rupeepower helps banks in digitising their customer acquisition process, thereby freeing up valuable resources across sales, operations and credit functions. Some of the major banks partnering with RupeePower are Standard Chartered Bank, State Bank of India, PNB HFL, Kotak Mahindra Bank, Aditya Birla Financial Services, RBL Bank, Yes Bank and ICICI Bank.

RupeePower was one of the 10 acquisitions done in Snapdeal’s shopping frenzy from December 2014 to September 2015 across key areas like fashion and logistics helping the company diversify into new areas like online services and grocery delivery.

While some of the deals like Freecharge, where Snapdeal is also raising capital independently, have done well for the company, several others have failed. GoJavas, the logistics firm where Snapdeal invested more than $37 Mn (INR 250 cr) in 2015 has temporarily shut down operations. Also, Snapdeal’s other investment, grocery startup PepperTap shut down its hyperlocal operations in April 2016.