Sequoia, Norwest lead $52m round for India's Five Star
Sequoia Capital and Norwest Venture Partners have led a INR3.3 billion ($52 million) Series C round for Indian non-banking financial company Five Star Business Finance.
Norwest and Sequoia both committed INR1.4 billion, according to Indian media reports, while existing investors Morgan Stanley Private Equity Asia (MSPEA) and Matrix Partners India invested INR610 million and INR20 million, respectively. Part of Norwest and Sequoia’s commitment went to buying shares from the company’s promoters. The round values Five Star at INR13 billion.
Five Star will use the new capital to expand its loan book, which it aims to grow from INR5.5 billion currently to INR10 billion by March next year and to INR30 billion by 2020. The company will also grow its geographical reach. It now operates in Tamil Nadu, Andhra Pradesh, Telangana and Karnataka, and it hopes to scale up in those areas while also entering Maharashtra and Madhya Pradesh.
Founded in 1984, Five Star has specialized in small ticket business and housing loans since 2010, when the founder turned over control to a family member. The company typically lends up to INR400,000 to businesses and INR700,000 to home buyers. It claims to have a non-performing asset ratio of below 3%.
Matrix was the company’s first institutional backer, having provided two rounds in 2014 and 2015. MSPEA invested INR1.14 billion in the company last year. Sequoia’s investment follows a number of credit and financial services-oriented commitments, including a $6.3 million Series A round for online financing marketplace KredX last year and a $9 million round for online credit assessment start-up MoneyTap in June.
More on South Asia
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.