India's Power2SME receives $36m Series E

Backers included Inventus Capital Partners, Accel, Kalaari Capital and Nandan Nilekani, co-founder and non-executive chairman for Infosys. The International Finance Corporation (IFC) came in as a new investor, confirming a $10 million contribution to the round earlier this month.

It follows a $20 million round early last year. The fresh capital will go toward a geographic expansion as well as product development, evaluation of potential acquisition, and a marketing push.

Power2SME operates a platform that helps small and medium-sized enterprises (SME) buy raw materials at bulk prices and get working capital without collateral. The company claims to have a registered base of 50,000 SMEs across India. According to a statement, it has been profitable since November. The performance is projected to further improve on the back of recent changes to India's goods and services tax regime.

Inventus and Kalaari were the first outside investors in the company, paying $1.9 million for a combined 10% stake in 2012. 

"Our investment in Power2SME will spur greater VC interest in the SME sector in the country and support India's vision to become a global manufacturing hub," said Ruchira Shukla, South Asia regional lead for venture capital at IFC. "By working with SME-focused companies and partner financial institutions, we aim to improve access to finance for over one million SMEs in the next five years."

SMEs, including companies in the micro category, account for 45% of India's industrial output and 40% of exports. Funding for this space is said to amount to around $320 billion compared to a total demand of $500 billion.

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• Topics
• South Asia
• Support services
• Expansion
• India
• Accel Partners
• Kalaari Capital
• IFC
• manufacturing
• Financial Services
• TMT
• Growth capital