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Income-based funding platform Klub has raised an undisclosed amount from market-linked Northern Arc Capital as part of a round of debt financing, the company said in a statement on Thursday.
It plans to give online traders access to funds to enable them to use flexible growth capital, the company said. Klub will also increase its integrated platform to support digital small and medium enterprises (SMEs) by 20 times with growth capital ranging from Rs 2 lakh to Rs 30 crore, the company said.
Klub has partnered with India’s leading e-commerce platforms, which the company says will provide opportunities of around $ 100 billion by 2025. It claims to have provided access to flexible capital to more than 200 000 SMEs on these platforms. Merchants in online marketplaces will now be able to access Klub’s financing options either directly on the platforms they sell on or through their preferred payment gateways and logistics partners, the statement said.
“Klub’s integrated financing solution helps merchants in our partner marketplaces easily access capital without leaving the marketplace ecosystem,” said Sudharsan Venkatakrishnan, vice president of Klub.
The company had appointed Venkatakrishnan, a former Capgemini executive, in November to head Blaze, Klub’s latest business offering, which provides marketing and inventory capital to digital SMEs in partnership with non-bank financial firms (NBFC ).
Venkatakrishnan, an IIM alumnus in Ahmedabad, previously worked as COO of MyShubhLife (formerly Shubh Loans), a comprehensive digital lending and savings platform, where he was part of the founding team, determining in the construction of its fintech platform as well as the launch of financial products. He worked at Capgemini as a senior consultant until 2015.
Founded in 2019 by Anurakt Jain and Ishita Verma, Klub, operated by Ken Capital Technologies Pvt Ltd, provides flexible growth capital against future receivables, ranging from Rs 2 lakh to Rs 30 crore, with no equity dilution or personal guarantees .
They also facilitate the funding of recurring marketing, inventory and capital expenditures for a wide variety of digitally-focused businesses and SMEs in the areas of e-commerce, direct-to-consumer (D2C), electronic technology, software as a service (SaaS), and the broader spectrum of digital commerce.
Previously, Klub had raised Rs 20 crore (approximately $ 2.7 million) in debt financing from Trifecta Capital. In August, they raised $ 20 million (around Rs 148.6 crore) in a seed funding round led by 9Unicorns and Sequoia Capital India’s Surge and joined by Alter Global and GMO Venture Partners.
For market-linked Northern Arc Capital, Klub’s investment adds to its portfolio of finance companies. In November, Credit Fair, a fintech consumer lending start-up, obtained an undisclosed sum in the form of debt from Northern Arc Capital. In October, VCCircle reported that Berar Finance Ltd, which operates a two-wheeler-focused finance unit, raised debt financing from the alternative investment arm of the non-bank finance corporation (NBFC) Northern Arc Capital. . Northern Arc Capital had also led debt investment rounds in BharatPe earlier this year.
“Northern Arc has always believed in partnering with pioneering companies like Klub that disrupt the existing ecosystem at an early stage. Our ability to understand the potential and risks of the underlying sectors and markets helps us to underwrite these institutions and provide them with suitable products throughout their lifecycle, ”said Bama Balakrishnan, COO. , Northern Arc Capital.
The Chennai-based lender, who has filed an IPO application to raise up to Rs 300 crore and an offer to sell (OFS), may also consider issuing shares for a private placement up to Rs 150. crore, before filing the DRHP as a pre-IPO Placement.
The proceeds of the issue will be used to increase its capital base to meet future capital needs.
In March 2021, its risk-weighted asset ratio was 28.89%, of which 27.62% in Tier I capital.
For FY 21 net profit stood at Rs 76.59 crore on total operating income of Rs 681.17 crore, compared to Rs 102.93 crore a year ago on income of Rs 632, 82 crore. Its gross NPA was 2.3%, while its net NPA was 0.9%. NBFC’s total outstanding loans without deposit amounted to Rs 3,920.81 crore.
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