The recent spin-off of PhonePe from its Indian parent company Flipkart and its subsequent fundraising from global behemoths is a case in point. Bengaluru-based PhonePe, one of India’s biggest digital payments platforms, recently bagged $700 Mn from Flipkart’s US parent Walmart and other existing investors at a post-money valuation of $5.5 Bn. Soon after that, it raised another $21 Mn from the Indian ecommerce giant that still holds 87% stake in PhonePe.
But the latest rounds of funding amassed by PhonePe come with a string attached, apparent from the slew of announcements the company has made. These include a bouquet of new products, getting profitable by 2022 and most importantly, getting ready for a 2023 initial public offering (IPO). These are not mere rhetoric as PhonePe has already entered key segments such as mutual funds and insurance and is planning to enter loans in 2021.
What’s more, in its new avatar, PhonePe will compete with deep-pocketed rivals, including…