Cashback and coupons site CashKaro said on Tuesday it has raised an undisclosed amount in funding from Ratan Tata, chairman emeritus of Tata Sons.
This is the third investment in 2016 for Tata, one of India’s most active angel investors last year. Earlier this month, he had put money in animal lovers’ portal Dogspot and startup data analytics firm Tracxn. Tata has invested in about 20 startups since he hung up his boots as the chief of the Tata Group in December 2012.
“Ratan Tata’s investment shows that in the affiliate marketing segment we are the leader. That credibility is important,” said Swati Bhargava, co-founder of CashKaro, which is operated by UK- and India-based Pouring Pounds Pvt Ltd.
The startup will use the funds to strengthen its marketing efforts in order to deepen brand awareness in India. The firm is also looking to enter Singapore and other Southeast Asian markets. The firm is looking to hire more senior talent as it will launch a mobile app in coming months, said Swati.
CashKaro was founded by entrepreneur couple Swati and Rohan Bhargava, both graduates of the London School of Economics, in February 2011. It competes with the likes of Rocket Internet-backed CupoNation, CouponRaja, CouponDunia and MyDala, among other players.
The funding from Ratan Tata comes soon after the startup raised $4 million (Rs 25 crore) in a Series A round led by venture capital firm Kalaari Capital and others in November 2015. Tata is an advisor at Kalaari and has also backed several other portfolio companies of the VC firm. It had previously raised $750,000 (Rs 4.5 crore) from a group of 10-12 UK-based angel investors.
Cashback is not new in India but not many are aware of the concept, and that is the challenge CashKaro faces. Swati said the company is taking a number of initiatives to make the site more consumer-friendly. “We have introduced a price comparison and product discovery feature on CashKaro. We are going to be working on developing that technology and making it more user friendly for customers,” she said.
The startup works with e-commerce firms such as Flipkart, Amazon, Paytm and Jabong. When users shop on these websites via CashKaro, they receive extra cash from the site which is collected in the CashKaro account. This money can be paid to a user’s bank account as real cash or can be redeemed as a Flipkart or Amazon voucher. “When you go via us and buy, we get a commission from the retailer and we share that commission as cash back with customers,” said Swati.
CashKaro does 250,000 to 300,000 transactions a month and works across retail categories such as fashion and electronics. “Retailers like working with a model like CashKaro because they feel it’s a very performance-driven model,” said Swati.