Falcon Edge backs India B2B platform OfBusiness
Falcon Edge Capital has led a $110 million growth round for India’s OfBusiness, a B2B platform for industrial sector services, at a post-money valuation of $800 million.
The investment has been billed as a Series D extension and includes support from Matrix Partners India, Norwest Venture Partners, and Creation Investments.
The round involved a mix of primary and secondary shares, with 73 employees and 12 angel investors selling stock worth $13 million. It brings total funding to date to $170 million, including a $35 million Series D in 2019 and a $29 million Series C in 2018.
Falcon Edge is investing via its Alpha Wave Incubation Fund, a $300 million vehicle backed entirely by a state-owned entity in the United Arab Emirates (UAE) targeting a growing cross-border opportunity between Asia and the Middle East. Alpha Wave advanced this strategy as recently as last month, when it provided $75 million for a UAE expansion by Indian insurance portal PolicyBazaar.
OfBusiness has not specified any plans to enter the Middle East. However, last year the company hired Suraj Mathew, a sales professional with significant experience in UAE and Bahrain, as its head of corporate sales. India's Infra.Market, a similar industrial B2B marketplace that raised $100 million in February, is backed by a local unit of Dubai's EIF Managers and is active in UAE.
Founded in 2015, OfBusiness specializes in helping small to medium-sized enterprises (SME), especially in the manufacturing and construction sectors, with a range of B2B supply chain, materials procurement, and logistics services. It also has capacities in marketing and project financing through unsecured credit lines.
The company serves almost 9,000 customers with 620 staff across 14 offices India-wide and generates annual sales of almost $1.5 billion, according to a statement. The fresh capital will be used for an expansion of its current footprint, enter new industrial categories, and add another 100 employees. The plan is to increase revenue by 3x.
B2B and SME supply chain marketplaces that streamline processes in India's fragmented industrial sectors are a popular investment category. In addition to Infra.Market, OfBusiness' competitors in this space include Moglix, which raised about $100 million in VC funding to date, and Zetwerk, which raised a $120 million Series D in February.
Bangalore-based Udaan, which connects manufacturers with various consumer-facing SMEs on an e-commerce-focused platform, is arguably the best-funded player with around $1.1 billion raised to date. It claims to be the largest platform of its kind in India with more than three million users in 900 cities as of January.
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