SME lending, procurement startup OfBusiness gets $110M from Falcon Edge, Matrix Partners, others

Credit and Finance for MSMEs: Small and medium enterprise (SME) focused platform for raw material procurement and credit access OfBusiness has raised $110 million in a Series D round of funding led by Falcon Edge Capital. The existing investors at a six-year-old startup including Matrix Partners India, Creation Investments, and Norwest Venture Partners also participated in the latest round that came over 18 months after it last raised $34 million in September 2019. The current round also witnessed 73 employees and 12 angel investors at OfBusiness sell stock worth $13 million.

OfBusiness focuses on enterprises in manufacturing and infrastructure sectors toward their procurement of metals, chemicals, polymers, agri commodities, petrochemicals, and building materials. It facilitates cash flow-based financing for buying raw materials through its NBFC Oxyzo Financial Services. The company claimed a GMV run rate of $1.5 billion. Over the last year, OfBusiness secured $200 million in debt from over 40 lending partners including IDFC First, Kotak, SBI, Bank of Baroda, Bank of India, Punjab National Bank, ICICI, HDFC, and others. The company will deploy the new capital towards expanding its number of supply chains and regions it operates in. It is also looking to make a few strategic investments and tuck-in acquisitions to penetrate deeper into existing supply chains.

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“We have an unwavering belief in the potential of commerce and financing in the B2B landscape and our vision is to just keep doing more of what we have done so far,” said Asish Mohapatra, Co-founder and CEO, on behalf of team OfBusiness. “OfBusiness stands alone today in the B2B supply chain terrain in its provision of a value-added full-stack solution to small and medium enterprises,” said Navroz Udwadia, Partner, Falcon Edge Capital. The latest round has taken the total fundraising by OfBusiness to $193.1 million across seven rounds of funding, as per Crunchbase.

India’s online B2B market is expected to grow from $1.7 billion at 80 per cent CAGR to $60 billion by 2025, according to a RedSeer study. The market has a margin of 0-4 per cent however it has the potential to increase to nearly two-fold on the back of direct procurement from brands, providing value-added services such as technology solutions and credit, etc. Among the prominent startups in India’s B2B e-commerce market are Udaan, ShopX, Jumbotail, etc.