OfBusiness in talks with SoftBank to raise funds at $1.2 billion valuation


Bengaluru: OfBusiness, a business-to-business (B2B) e-commerce platform, is in talks with Japan’s SoftBank Group Corp. to raise $100-150 million at a valuation of $1.2 billion, two people in the know of developments told ET.

“SoftBank could invest anywhere between $100-150 million in an all-primary funding round,” said one of two people cited above.

If the deal goes through, it will add to a slew of fresh investments that SoftBank Vision Fund II has made in India this year. Among its investee companies are social commerce startup
Meesho and banking technology platform
Zeta, both of which went on to become unicorns —private companies with a valuation of at least $1 billion. It is also
close to finalising a $450 million investment in food delivery platform Swiggy, according to an ET report.

Asish Mohapatra, co-founder and chief executive of OfBusiness, and a spokesperson for SoftBank declined to comment for this story.

OfBusiness, which recently
closed a $97 million round led by Falcon Edge, was valued at around $800 million in April. Some angel investors and employees sold shares in the funding round, taking the total size to $113 million. It counts Matrix Partners India, Creation Investments, and Norwest Venture Partners as its existing investors.

Slew of Unicorns

India has so far this year seen a record 14 unicorns being minted due to the increased availability of global capital coupled with bullish investor sentiment, especially for market leaders in fast growing sectors.

If the financing goes through, OfBusiness would be the latest B2B startup to join the unicorn club this year, following the likes of
Moglix and
Infra.Market. Accel-backed Zetwerk is another prominent startup in the space and competes with OfBusiness.

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Mohapatra recently told ET that OfBusiness
was preparing for an initial public offering (IPO) in the next two years. The company has been profitable for more than three years and plans to grow its revenue three-fold this year—fueling its expansion with the fresh capital.

Startup UnicornsETtech

(Graphic: Rahul Awasthi/ETtech)

The business model

Founded in 2015, OfBusiness focuses on the manufacturing and infrastructure sectors and is one of the leading B2B firms in the raw material supply chain space. It offers raw material procurement services and credit to small and medium enterprises (SMEs) through its NBFC Oxyzo Financial Services, which along with the B2B platform has a customer base of around 9,000.

The six-year-old startup also offers marketing services through its BidAssist platform, which has close to 2 million unique customers.

Over the last year, OfBusiness raised $200 million in debt across its 40 lending partners such as IDFC First Bank, Kotak Mahindra Bank, ICICI Bank and HDFC Bank. It operates out of 14 offices across India with over 600 employees and is looking to hire 100 more. It clocked annual gross merchandise value, or GMV, run-rate of about $1.5 billion last year.



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