India's Razorpay closes $375m Series F at $7.5b valuation
Indian payments start-up Razorpay has seen its valuation more than double in eight months on closing a $375 million Series F led by Lone Pine Capital, Alkeon Capital Management, and TCV.
Existing investors Tiger Global Management, Sequoia Capital India, GIC, and Y Combinator also took part in the round, the company said.
Razorpay achieved unicorn status in October 2020 when GIC led a $100 million Series D, supported by Ribbit Capital, Tiger Global, Y Combinator and Matrix Partners India. GIC and Sequoia then led a $160 million Series E in October at a valuation of $3 billion. It is now worth $7.5 billion.
The ramp-up in the company’s valuation has coincided with a pandemic-driven acceleration in digital payments uptake. Meanwhile, Razorpay remains one of the last large-scale standalone players in the space, following the $4.7 billion acquisition of BillDesk by PayU.
The company claims to be the only payments platform in India that allows businesses to accept, process, and disburse payments. Its payments gateway, which customers install in their websites and apps, is compatible with credit and debit cards, the nationwide united payments interface (UPI), and mobile wallets such as JioMoney, Mobikwik, Airtel Money, FreeCharge, Ola Money, and PayZapp.
As of early December, Razorpay had achieved $60 billion in total payment volume (TPV) for 2021, putting it on course to post 300% year-on-year growth for the second consecutive year. The TPV target for 2022 is $90 billion. The customer base is expected to rise from eight million to 10 million.
The company’s clients include Facebook, Ola, Zomato, Swiggy, Cred, Muthoot Finance, the National Pension System, and Indian Oil. It claims to work with 34 of the 42 Indian start-ups that have become unicorns in 2021.
Razorpay has also established its own neobanking platform, RazorpayX, which offers current accounts, corporate credit and debit cards, and automated salary, medical insurance, and other payments. RazorpayX has 25,000 users and disburses INR7-8 billion ($94-107 million) every month.
The new funding will support Razorpay’s goal to become a full-stack financial solutions company, solving all payment and banking needs of businesses on one platform. There are plans to scale up RazorpayX, make acquisitions in the B2B software-as-a-service (SaaS) space, and expand overseas, with Southeast Asia the initial priority. Headcount is expected to rise by more than 600.
Harshil Mathur founded Razorpay with fellow Indian Institute of Technology Roorkee alumnus Shashank Kumar in 2014. The company has raised $740 million in funding since its inception. Other backers include Salesforce Ventures, MasterCard, and around 33 angel investors.
“We are delighted to back Harshil, Shashank and the entire Razorpay team. We think they are building the next-generation payments and banking platform in India, and we look forward to supporting them on their mission and future expansion. We could not be more excited to partner with this founding team,” said John Doran, a general partner at TCV, in a statement.
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