This week, Reliance Retail made a $200-million bet on delivery firm Dunzo for just under 26% stake and SBI invested $20 million in fintech Pine Labs. The deals provide further confirmation that India’s largest conglomerates and public-sector banks are ready to plunk down serious cash to back technology startups at a higher valuation.
Last year, Tata Group had acquired e-grocer BigBasket and online pharmacy 1mg, spending a total of about $1.2 billion.
The latest deals have some interesting nuances.
The stakes for SBI: Pine Labs, a merchant payments platform, was last valued at $3-3.5 billion, and it is currently raising money from Falcon Edge at a valuation of over $5 billion, according to reports. Even if SBI invested at a valuation of $3 billion, it would get a stake of less than 1%. That India’s largest public-sector bank is spending $20 million for a small pre-IPO stake in a fintech is not something we saw coming.
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