Funds to be utilized towards diversifying the product portfolio and expanding the team at Avail Finance
3rd September 2020. Bengaluru: Avail Finance, one of India’s leading neo-banks that provide products tailored to India’s aspirational blue-collar workforce raised $11.5 million in Series B funding. The investment round was led by Alpha Wave Incubation (AWI), a $300m venture fund, managed by Falcon Edge Capital, a leading global alternative asset manager, and backed by ADQ, one of the largest regional holding companies based in Abu Dhabi. This round also saw participation from existing investor Matrix Partners. Avail was founded in 2017 and has grown from being a lending platform to the blue-collar workforce to now a neo-bank with a lineup of products in various categories such as savings, insurance, investment products etc.
With its current customer base of more than 3Mn users in India, Avail Finance’s vision is to bring the underbanked population of India, into the formal financial economy. Given the absence of sufficient formal records and documentation, Avail’s target customers often do not have access to financial services. Therefore, the company’s objective is to create a platform that is easy to access and caters to the specific needs of this customer base.
The global neo-bank market was worth USD 19 billion in 2018 and is likely to accelerate at a (CAGR) of around 46.5% between 2019 and 2026, creating approximately USD 400 billion of value by 2026 (Source: https://www.pwc.in/consulting/financial-services/fintech/fintech-insights/neobanks-and-the-next-banking-revolution.html). There is tremendous potential for neo-banks since it is driven by their low-cost model for end consumers, with no or very low monthly fees on banking services such as minimum balance maintenance, withdrawals, and deposits. Neo-banks is adopted primarily by millennials, MSMEs, and those having sporadic income levels but is digitally savvy. Avail, through its strategic partnerships and unique acquisition model, services gig-workforces like delivery boys, driver-partners of some of the major players of the industry – OLA, Swiggy, Zomato, Rapido and Quess Corp, through specifically designed financial products as per the need and suitability for them.
Commenting on the fundraise, Ankush Aggarwal, Founder, and CEO of Avail Finance said, “Avail Finance was founded with a vision to create an inclusive platform to serve a blue-collared workforce with financial solutions that meet their daily needs. The aim is to identify credit-worthy individuals that are currently underserved by formalized lending institutions such as banks and NBFCs and provide them with a line of credit by a hassle-free experience. The funds raised will be used for the expansion of the team, and to offer a varied product mix for our targeted users, be it existing or prospective. Globally, the neo-banking sector has flourished and this trend has also been seen in the Indian market. With our financial solutions for the blue-collared workforce in India, we can capitalize on this current shift towards neo-banking through easy and digitized facilities suitable for the Indian market.”
As part of this investment from AWI, Avail Finance will set up a team in Abu Dhabi and use the Emirate as its regional headquarters. It aims at building a strong talent base of Data Scientists, Product Managers, and Engineers there.
Vikram Vaidyanathan, Managing Director, Matrix India, said, “Avail’s NeoBank offering targets the underserved low-income consumer, now aggregated by the gig-economy. Avail has served this consumer in a differentiated manner, solving for core challenges faced while serving this customer base – the cost of acquisition, NPA, and churn. We’re privileged to have been early partners with Ankush and the team, and welcome Falcon Edge to the partnership”
“The segments of the population that Avail targets are chronically under-served and starved for capital. Through its unique partnerships, Avail demonstrates best-in-class customer acquisition costs and has developed an AI-led underwriting engine and an alternate credit score to lend to these customers in a differentiated manner”, said Navroz D. Udwadia, Co-founder and Partner of Falcon Edge Capital.
He added, “Avail has built a solid execution track record in India, and we are excited to support their next phase of expansion to new markets across the region.”
About Avail Finance:
Founded in 2017 by Ankush Aggarwal and Tushar Mehndiratta, Avail Finance is a fintech company that is focused on the blue-collared segment. Avail has multiple products that are customized to this segment – savings, insurance, investment products, Personal Loans – that help its users to be financially included and independent. With the help of machine learning and AI, Avail creates a unique analysis on its backend which helps it achieve what the team truly believes in – access to financial products, irrespective of income, geography, age, gender, or the ability to furnish documents. The company is backed by Matrix Partners and ANI Technologies (Ola), and other prominent entrepreneurs like Binny Bansal, Co-founder of Flipkart, Kunal Shah, Founder of Cred, Manish Patel, founder and CEO of Mswipe among others. To know more, visit: http://availfinance.in
About Matrix Partners India:
Matrix Partners India is an investment firm with approximately $1 billion under management. Founded in 2006, the firm invests in companies targeting the Indian consumer and enterprise market at the seed, early, and early growth stages. Matrix India has invested in several markets leading financial services companies, such as Five Star Business Finance (SME lending), OfBusiness (credit led B2B marketplace), Razorpay (payments), Mswipe (mobile POS), Ola Financial Services (digital-first financial products), Jupiter (consumer Neobank), OneCard (mobile-first credit card), ZipLoan (SME lending), CreditVidya (consumer lending platform), LiquiLoans (peer to peer lending), YeLo (mobile-first Neobank), goDutch (group payments platform).
Other marquee investments include Ola (mobility), Quikr (online classifieds), Practo (digital health platform), Dailyhunt (mobile local language platform), Treebo (digital hotel chain), Limeroad (social e-commerce platform), Ola Electric (electric vehicles), Stanza Living (tech-enabled student housing platform), Country Delight (direct-to-home, mass premium milk brand), Camp K12 (a global online school for 21st-century skills), Vogo (scooter sharing), and Cloudnine Hospitals (leading chain of maternity hospitals), among others. Matrix India has advisory offices in Bangalore, Delhi, and Mumbai. Matrix Partners has a global network of funds investing in the US, China, and India, with approximately $5 billion under management. Further information is available at www.matrixpartners.in. To know more about our investment philosophy & ideologies, check out the #MatrixMoments podcast series.
About Alpha Wave Incubation (AWI):
Alpha Wave Incubation (AWI) is a $300m venture fund managed by Falcon Edge Capital and backed by ADQ. AWI has a dedicated team across London, Bangalore, and Abu Dhabi. The fund invests in early-stage tech-enabled, disruptive start-ups in India and South East Asia. In addition to providing outstanding founders with early-stage capital, AWI offers access to an nrivalled set of support mechanisms for business-building, while also helping companies expand globally and open up new markets in the GCC/MENA region and beyond. ADQ is one of the region’s largest holding companies with a broad portfolio of major enterprises spanning key sectors of Abu Dhabi’s diversified economy.
About Falcon Edge Capital:
Falcon Edge Capital is a diversified global alternative asset manager co-founded in 2012 by Rick Gerson, Navroz D. Udwadia, and Ryan Khoury. Falcon Edge manages approx. $4bn in assets across public and private markets. Falcon Edge has offices in New York, London and Bangalore. The firm offers a variety of investment products and strategies that cover several asset classes, themes, and geographies.
