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Wednesday 29 September 2021

Debt platform, CredAvenue raises

Debt platform, CredAvenue raises
$90 million in Series A equity funding round

  • Funding round led by Sequoia Capital India with Lightspeed, TVS Capital Funds and Lightrock India as co-leads
  • Other investors include CRED and Stride Ventures
  • The equity funding values the company at approximately $410 million

 CredAvenue today announced the closing of its first funding round of $90 million led by Sequoia Capital India and co-led by Lightspeed, TVS Capital Funds, Lightrock and others. Avendus Capital was the exclusive financial advisor to CredAvenue on the transaction. 

CredAvenue is building infrastructure to power debt markets and offers unparalleled solutions for discovery and execution across a wide range of products. To date, it has facilitated transactions worth ~ $9 billion through the platform, while engaging with 1,500+ institutional borrowers and 750+ investors, touching 1 million+ end retail borrowers.

The funds raised in this round will be utilized towards expanding product capabilities and ramping up the platform’s technology and data science infrastructure. The company aims to invest heavily in data science, machine learning and artificial intelligence over the next few months to significantly improve and expand its product offerings, across each of its sub platforms. CredAvenue aims to transform from an assisted platform to a completely self-serve one, thereby improving the speed and autonomy of the platform users.

CredAvenue, which has been on a hyper-growth trajectory over the last year, today comprises over 350 employees spanning across different verticals - technology, sales, marketing, strategy, HR. It expects to double its headcount to 700 by the end of FY22. The company also plans on global expansion and inorganic growth through strategic acquisitions.  

Gaurav Kumar, Founder & CEO, CredAvenue, said, “At CredAvenue, our objective is to revolutionize the debt market through technology and innovation.  We are the only enterprise debt platform offering all forms of debt, both in India and globally and this reflects in the scale of business done by our platform since inception. We are building something truly transformational, and we aim to increase the debt to GDP of our country with CredAvenue. We are delighted to welcome the Series A investors to our journey. They will catalyze our mission with capital and guidance, to keep expanding our lead in this market.”

Combining deep technological innovation with expertise in financial product design, the company is one of the only fintech platforms with deep technology integrations across the top ten banks and mutual funds in India, representing loan assets worth $1 trillion+, that form the core of the financial services establishment in the country. The product stack allows for a high level of interoperability making CredAvenue a one-stop solution for all debt needs.

CredAvenue’s goal is to transform the debt markets globally, starting with India, by deepening access to capital for the growing enterprise sector to unlock significant economic growth. It does this by doing three things. First, creating a transparent marketplace for financial services firms on one side and enterprises on the other side to discover lending and borrowing opportunities. Second, developing a robust product suite and credit rating mechanism to enable stakeholders to find an appropriate product-risk fit and last, creating a robust and low friction UX that not only automates the execution of the transaction but also offers continuous portfolio monitoring.

The company has already achieved market leadership across various debt categories including co-lending, loans, and bonds, by simplifying access and servicing and helping consumers seamlessly navigate multiple offerings through a single portal.

 Quotes by Series A Investors:

Sakshi Chopra, MD, Sequoia India, said, "Gaurav and team are veterans in the industry and we are delighted to partner with them in their vision to deepen the debt markets in India which currently remain underdeveloped at ~65% of GDP, well behind the global average of ~150%. CredAvenue is a unique solution that not only simplifies access to credit for borrowers ranging from a BB to AA rating but also improves access to multiple debt products like bonds, supply chain financing, etc. on a single unified platform. We believe, it has the opportunity to become the platform of choice for borrowers and lenders operating in the debt market."

Aditya Sharma, Partner - Growth Equity, Lightspeed, said, "CredAvenue is a unique multi-product platform that is digitising the Indian debt markets. With its deep focus on technology, product innovation and process automation, CredAvenue has created a thriving marketplace for credit discovery and technology-led monitoring and fulfilment. We look forward to collaborating with the entire CredAvenue team to help transform the Indian credit markets."

Kartik Srivatsa, Managing Partner of Lightrock India, said, “We are excited to back the team at CredAvenue as they emerge as one of the canonical businesses transforming the financial services sector through a differentiated platform that stands out in today's fintech ecosystem with a clear value proposition validated by a strong monetisation model.”

Gopal Srinivasan, Chairman at TVS Capital Funds Ltd, said, “Proactive regulatory reforms are having a game-changing impact on the debt market structure in India. CredAvenue’s platform can provide institutional investors access to larger liquidity pools at market-efficient rates and faster transaction times. Also, with its easy access and the right information, the platform is facilitating larger participation of retail investors in the corporate debt market, which is driving financial inclusion in the fixed income category and is an enabler for the national economic direction in the much-needed deepening of the bond markets in India. We are convinced that CredAvenue can be the leader in this transformative journey of Indian debt markets.”

Kunal Shah, Founder, CRED, said, “CRED is really excited to partner with and invest in CredAvenue as they build phenomenal infrastructure to supercharge India's debt markets with technology."

Ishpreet Gandhi, Founder and Managing Partner, Stride Ventures, said, “We are ecstatic to work with CredAvenue's strong founding team, which has extensive experience and is a forerunner in debt distribution. At CredAvenue, we see a huge opportunity to change the way debt is handled in India. Stride will continue to invest in businesses with distinctive product offerings and platforms.”

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