PhonePe Raises $350 Mn From General Atlantic, Joins India’s Decacorn Club

Payments and financial services unicorn PhonePe has raised $350 million in funding from General Atlantic, a leading global growth equity firm, at a pre-money valuation of $12 billion, making the Walmart-owned start-up the most-valued financial technology (fintech) player in India. The investment is the first tranche of the company’s latest fundraise that could see marquee global and Indian investors put in up to $1 billion in the fintech firm. With this funding round, the home-grown digital payments start-up has more than doubled its valuation — from $5.5 billion in 2020. With a $12-billion valuation, it has joined the decacorn club.

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More About This Fundraise By PhonePe:

• PhonePe has managed to raise late-stage funding amid a funding winter. General Atlantic will be infusing substantial capital, along with Walmart and other new investors, to a final raise of $1 billion.
• The latest fundraise follows the company’s recently announced change of domicile to India and full separation from Flipkart. It could not be immediately ascertained how the market capitalisation table of the company will look like, given other investments will come in some weeks.
• Additionally, Qatar Investment Authority and Microsoft have brought shares directly into the company as part of its complete separation from Flipkart.
• PhonePe plans to deploy the funds to make investments in infrastructure, including development of data centres and build financial services offerings at scale in the country. The company also plans to invest in new businesses, including insurance, wealth management, and lending.
• PhonePe recently announced a full separation from Flipkart Group. After partial separation from Flipkart in December 2020, several Flipkart shareholders, led by Walmart, acquired shares in the recent separation. This move will allow both companies to chart their growth paths and build their businesses independently.

Significance of This Move: