• Paytm

  Led · Equity · Aug 2016

  Paytm, operated by One97 Communications, offers a mobile wallet that lets users transfer money, pay bills, buy tickets, and access small loans; it also sells e‑commerce, games and ticketing services. The company has expanded merchant services, claiming 15 million merchants and presence in over 2,000 towns and cities in India, and also offers its wallet in Japan. Paytm plans to use fresh capital to court merchants and expand financial offerings such as lending and insurance, and has committed additional investments (including a stated ₹10,000 crore commitment and a September plan to invest $2.7 billion over two years). The firm reported a loss of $549 million for the fiscal year ended March, up from a $206 million loss the prior year, and said it has cut its burn by more than a third in the past six months. Founder Vijay Shekhar Sharma has indicated the company may consider an IPO in two to three years. Paytm faces intensified competition in India from Google Pay, Walmart’s PhonePe and the impending WhatsApp Pay rollout. Paytm is an Indian payments gateway and digital wallet provider offering comprehensive payment services for customers and merchants. It provides mobile payment solutions to over 7 million merchants and allows consumers to make mobile payments from cards, bank accounts and digital credit. Paytm brought QR-based mobile payments to the Indian market and launched Paytm Payments Bank. The company has a stated mission to bring 500 million Indians into the mainstream economy through financial inclusion. Berkshire Hathaway's investment and the addition of its investment manager to the board underscore investor confidence in Paytm's financial-services growth trajectory. The articles report an implied company valuation of approximately $10–$12 billion tied to the recent transaction. Paytm is described as India's leading digital payments firm. The company's core business is in digital payments. It has raised $1.4 billion from SoftBank Group Corp. The round is noted as the largest funding round by a single investor in India. The investment is characterized as SoftBank's biggest bet in India's start-up ecosystem. Paytm E-Commerce operates a mobile commerce platform covering payments, recharges, shopping and movie tickets. The company reports over 200m registered users. Led by CEO Vijay Shekhar Sharma, Paytm is the consumer brand of One97 Communications. The company plans to use the funds to expand its online business. One97 Communications is backed by Ant Financial (Alipay), Mediatek, Sapphire Venture and Silicon Valley Bank. The articles describe the recent transaction as an equity stake sale that injected $200m into the business. Paytm operates a broad digital-commerce platform that provides mobile wallets, payments, ticketing, on-demand services, travel bookings, and a marketplace for physical goods. The company reports 135 million digital wallets in use and about 3 million transactions per day, claiming roughly 75% share of India’s digital wallets. Paytm says it has raised $760 million to date and plans to use new funding to expand and scale its payments and commerce businesses. A key near-term product plan is Paytm Payments Bank, an online bank for consumer savings and loans that the company has been building for months. Paytm will reorganize by splitting payments/financial services and its e-commerce sales platform into separate entities owned by parent One97 Communications. The company is partnering with Mediatek for integrations into smartphones, reflecting a strategic hardware-services tie-up mentioned in the articles.

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