Google joins Progcap as new investor in its $40 mn round

Google joined as a new investor in Progcap as the small and mid-size business-focused financing provider raised $40 million (around ₹308 crore) as part of its Series C funding round led by existing investors Creation Investments and Tiger Global Management.

The fundraise valued the New Delhi-based startup at $600 million, a three-fold jump from its previous valuation of $200 million.

Another existing investor, Sequoia Capital India, also participated, bringing the total Series C funding round to $70 million (around ₹539 crore).

Progcap also aims to turn operationally profitable in the coming months, co-founder Pallavi Shrivastava said in an interview on Monday.

Progcap, run by Desiderata Impact Ventures Pvt. Ltd, has raised nearly $100 million in equity funding in the last 12 months. It also recorded annualized disbursal of $1 billion.

The company plans to use the fresh capital towards product development and support current expansion efforts, it said in a statement separately.

Last October, Progcap raised $30 million as part of the Series C funding round led by Tiger Global and Creation Investments. This followed the company raising $25 million as part of its Series B investment round led by Tiger Global and Sequoia Capital in June.

In February 2021, the startup collected $1.37 million in a debt funding round led by Stride Ventures. Previously, Sequoia led a $5 million Series A round of funding into Progcap in July 2019. Others who participated in that exercise included CIBIL chairman MV Nair, Freecharge co-founder Sandeep Tandon and GrowX Ventures Fund. In April 2019, it raised $1 million in a round led by GrowX Ventures.

The fintech startup claims its platform is used by 700,000 retailers. It is also looking to acquire a non-banking financial company (NBFC) through acquisition to aid business growth, Shrivastava said.

“Progcap is becoming the core operating engine for all the transactions of its customers, providing them with credit and technology solutions that make their businesses more efficient,” said Srivastava and another co-founder Himanshu Chandra, according to the statement.

Last year, the company appointed several senior executives to bolster its leadership team. These included Abhinav Singh, previously associate partner at McKinsey & Co., who joined the company as its chief growth officer, and Ashish Gupta, a former chief technology officer of PolicyBazaar, who leads tech and product functions at Progcap.

Established in 2017, Progcap aims to be a full-stack retailer-focused digital bank which enables capital flow across the supply chain to underserved retailers.

The company says it provides clients with easily accessible and flexible collateral-free working capital loans through its financing solution provided to retailers in tier-2, tier-3 and tier-4 locations.

Shrivastava, an alumnus of XLRI Jamshedpur, had previously worked with International Finance Corporation as the regional lead, Hinduja Group and Infosys. Chandra was earlier associated with Barclays and Standard Chartered Bank.