Sachin Bansal, one of the co-founders of Flipkart, is having talks to get money for his new business, Indian bank Navi. The amount of money Bansal wants to raise is about $2 billion, according to three people who know about the situation. Someone who knows him said that he wants to get $200 million to $400 million.
Up until now, Bansal has mostly paid for Navi himself. This would be the Bengaluru-based startup’s first big outside fundraising since it began in 2018.
The sources warned that since talks haven’t turned into a deal yet, both the terms and Bansal’s desire for outside funds could change. A Navi representative refused to say anything.
Navi, a company that helps people get personal and home loans as well as health insurance, has had some rough times with money. Navi filed papers in 2022 that say it wanted to raise $440 million through a public offering. But because the IPO market was down last year, the startup gave up on those plans.
The discussions about funding show a big change in the Indian startup market and are a good sign for fintech around the world. Overall startup funding in the country dropped 73% in 2023, which was a very bad year. This could mean that growth stage funding rounds are back on the table.
It was revealed last month ADIA, Abu Dhabi’s sovereign wealth fund, is in talks to back Pocket FM, an Indian platform for audio stories. Indian newspaper Economic Times reported Thursday that LensKart, a company that sells glasses, HealthKart, a company that helps people eat better, and Rapido, a company that helps people get rides on bikes, are all in talks to raise new growth-stage rounds of funding. In the past few weeks, investors backed by Swiggy have talked to Khazanah, Malaysia’s sovereign wealth fund, according to a source familiar with the subject who spoke.
A recent Bain report says that India’s startup ecosystem saw a sharp drop in big funding rounds last year. This was because global investors like Tiger Global and SoftBank cut their investments, and Indian venture capital firms turned their attention to early-stage companies.
In the past few years, the Reserve Bank of India’s regulatory moves have also affected startups that give out credit cards and loans, which has scared off many investors in the fintech sector.
Flipkart was a leader for startups in India when Bansal was in charge. It raised billions of dollars from a long list of famous strategic and financial backers. Then, in 2018, he left the startup with a $1 billion gain and chose to build Navi from scratch, which he started the same year.
This could be Navi’s first outside rise, but that doesn’t mean Bansal hasn’t been talking to people who are eager. Earlier reported that the fintech talked to possible investors, such as SoftBank, before filing for an IPO. Previously claimed that those talks came to an end when Navi’s application for a banking licence was turned down by the country’s central bank.
Navi has been focusing more on fewer things in recent quarters. It sold Chaitanya India, a microfinance company, for $178.5 million in August as part of a “strategic plan to focus on our digital-first businesses,” Bansal said at the time.
Bansal said in an interview that came out Tuesday in the Indian newspaper Moneycontrol that he would bring back plans for the IPO, but only in a “few months, once we are ready.”
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Also, Bansal hasn’t given up on the idea of making Navi a bank. “For now, I’d say we’ve put them on hold until we see if it’s possible again in the future,” he told the Indian news source. “Then we’ll start up again when the regulator gives us the all-clear.”
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