Power2SME gets funding from Nandan Nilekani, existing investors
Gurgaon-based BEBB India Pvt Ltd, which runs Power2SME, an online buying hub for small and medium enterprises (SMEs), has raised an undisclosed amount of funding from Infosys co-founder and former UIDAI chairman Nandan Nilekani with participation from existing investors Accel Partners, Kalaari Capital and Inventus Capital.
Queries sent to Power2SME on the details of the investment did not elicit any response till the time of filing this report.
"Power2SME has a unique business model that focuses on making SMEs bankable and profitable and am excited to watch the growth journey of this company as it continues to contribute in strengthening the SME social fabric of the nation," said Nilekani in a statement.
This marks Nilekani's sixth investment in a startup. He has previously invested in mobile startup Mubble, aviation tech startup Team Indus, online deal-making platform LetsVenture, logistics firm Fortigo and book publisher Juggernaut.
In 2014, Power2SME had raised Rs 42 crore ($6.87 million) from existing investors in its Series C round of funding. These included early-stage venture capital fund Accel Partners, Kalaari Capital and Inventus Capital. It secured its Series B round of funding of $6 million (Rs 35.7 crore) in April 2013 from existing investors Inventus Capital and Kalaari Capital, and from Accel Partners.
In October 2012, it raised Rs 10 crore in Series A funding from Inventus Capital Partners and Kalaari Capital.
"Power2SME is working towards creating an ecosystem that addresses SMEs' challenges in raw material procurement and financial assistance, which are major roadblocks for growth of SMEs. We have a very aggressive plan for developing our business and boosting revenues in the future," R Narayan, founder and CEO, Power2SME said.
Power2SME was founded in 2012 by R Narayan with a seed funding of Rs 2 crore. The company pools the demand of hundreds of SMEs for multiple products for their business needs, buying raw material directly from the manufacturers and selling to the SMEs. It also offers a range of services including logistics, HR and financial services to SMEs.
The portal aims to broadens its product portfolio and strengthens its technology platform and mobile app offering. It hopes to break even in the coming financial year, a statement from the company said.
Power2SME has worked with close to 30,000 SMEs helping them source competitively priced raw material as well as financial assistance through the large number of financial institutions that the portal partners. Among the big established suppliers on its portal are SAIL, Tata Steel, Essar Steel, Allied Strips, JSW, Rathi Steel, Victor Exim, Balaji Enterprise, Posco Steel, Apollo Pipes and JSL.
According to an internal survey at Power2SME, 70 per cent of monthly recurring costs for a manufacturing SME is incurred in purchasing raw material. Operating in an unstructured market, SMEs find it difficult to access the right quality raw material at the right price. Lack of access to easy finance and credit adds to the obstacles faced by SMEs.
In the B2B e-commerce space, Shotang.com last month raised $5 million (around Rs 33 crore) in Series A funding from Exfinity Venture Partners and Unitus Impact Livelihoods Fund.
Industrybuying.com, an online marketplace for industrial goods, recently received an undisclosed amount in angel funding from family members of the Chennai-based Murugappa and TVS groups. In September, it had secured Rs 60 crore ($9 million) in a Series B funding round from Kalaari Capital, existing investor SAIF Partners and Teruhide Sato's Beenext. It had raised $2 million from SAIF Partners in February.
Last month, Accel Partners seed-funded Bizongo, a B2B marketplace for industrial goods. MOGLILABS Pvt Ltd, which runs online marketplace for industrial tools Moglix, had raised pre-Series A funding from Accel Partners and Jungle Ventures.
In December 2015, Chinese e-commerce titan Alibaba Group Holding Ltd, which operates wholesale trading platform Alibaba.com, launched an online platform, SMILE, exclusively for Indian SMEs.