Startup for API infrastructure Setu is purchased by Pine Labs

Setu, a fintech infrastructure business, has been purchased by merchant commerce platform Pine Labs. The transaction is estimated to be worth roughly $70 million per Entrackr’s sources.

Sahil Kini, the co-founder of the business, stated at a virtual press conference on Thursday that “Setu will maintain its team and identity and continue to run autonomously.”

For Pine Labs in 2022, this acquisition marks the third. The company, which has its headquarters in Singapore, acquired a controlling stake in Mumbai-based startup Qfix and payments solution provider Mosambee in February and April, respectively.

Setu, a provider of financial technology infrastructure, has increased the range of services it provides through its automated programming interface to include payments, data, investments, and lending (APIs). The business teamed up with Google Pay in August 2021 to offer fixed deposits via Equitas Small Finance Bank.

In order to conduct research and aid fintech companies in adhering to regulatory standards, the company also runs the open-source project D91 Labs.

Around $18.5 million has been raised for Setu, including a $15 million Series A round in April 2020 that was sponsored by Falcon Edge and Lightspeed. During the financing, the company had a $50 million valuation. Entrackr was the only outlet to cover the news.

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In the API infrastructure market, Setu competes with companies like M2P Fintech, Signzy, and Decentro.

The company claimed operating revenue of Rs 3.31 crore in FY21 as opposed to nil in FY20, even though Setu has not yet submitted its annual financial statement for FY22.

Sahil Kini and Nikhil Kumar, the founders of Setu, have belonged to India Stack for more than six years. The majority of Aadhaar applications as well as the Digital India initiative are powered by a collection of proprietary software programmes and APIs that are privately owned.

While Kini had launched Magnet Works, an industrial IoT business, Kumar had previously co-founded Voyce, a customer feedback system for SMBs that was eventually bought by Exotel.

The acquisition occurs as Pine Labs broadens its product portfolio beyond merchant payments. Pine Labs also creates Buy Now Pay Later (BNPL), invoicing management, gifting solutions, and e-commerce solutions in addition to its Point of Sale (PoS) business, where the company provides card swiping terminals to retailers.

The company, which is currently valued at $5 billion, is also thinking about doing an initial public offering (IPO) in the US. According to media estimates, it would raise roughly $500 million from the public market at a valuation of $6-7 billion.

In its Series E round, backed by NewQuest Capital and Prosus, the re-commerce site Cashify has raised $90 million. Existing investors like Bessemer, Blume Ventures, Olympus Capital, and Paramark Ventures also participated in this round.

The company, which is based in Gurugram, has so far received $130 million, including a $15 million Series D investment in March of last year.

According to a statement from the company, Cashify would utilise the additional funds for marketing, growth into new markets, greater staffing, and the development of technology infrastructure. By the end of the following year, the company wants to increase its footprint from 120 stores in 45 cities to 250 outlets in 100 cities.

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According to Cashify, its worth increased by 2.5X since the Series D investment. The business did not, however, give precise figures. When it secured $50 million as the first tranche of this financing earlier this month, the company, according to Fintrackr, had a valuation of about $250 million.

Customers can purchase and sell used electrical devices on Cashify, primarily computers and cell phones. It works with a number of retail and online channels, OEMs like Xiaomi, OnePlus, and Samsung for their exchange programmes, in addition to purchasing directly from customers.

About 90% of the company’s revenue comes from the smartphone market, with the remaining 10% coming from laptop sales.

Cashify, led by Mandeep Manocha, competes with a number of other companies, including Greendust and Yaantra. Yaantra was purchased by leading online retailer Flipkart in January for $40 million.

Cashify reported a slight decrease in operational revenue for the fiscal year ended on March 31, 2021, from Rs 345.3 crore to Rs 340.4 crore. However, the business was able to contain its losses, which dropped from Rs 46.2 crore in FY20 to Rs 35 crore in FY21.

According to Cashify, its income has doubled over the past year, and it anticipates 2-2.5 times more growth in the coming year. Before considering a future public listing, the company also wants to break even over the following 18 months.

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