SoftBank-backed True Balance to get fresh fund infusion

Gurgaon-based Balancehero India Pvt. Ltd is set to receive fresh capital infusion, as the operator of a mobile balance-checking app plans to expand its service offerings after launching a digital wallet last month.

The company, which operates under the True Balance brand, plans to raise Rs 351 crore ($55.2 million) by issuing compulsorily convertible debentures to its Seoul-based parent Balancehero Co. Ltd Korea, its filings with the Ministry of Corporate Affairs show. The startup has received Rs 13.89 crore in three tranches over the past four months, the filings show.

The fund infusion comes in the backdrop of its announcementlast month that it was launching a mobile wallet, besides other financial services including peer-to-peer and wallet-to-bank-account transfers. At the time, the company had said the mobile wallet was intrinsic to its strategy to increase revenue.

The filings also show that True Balance intends to foray into ancillary payments services, including domestic money remittances, bill payments and financials transactions for online and retail merchants. The timeline for the launch of these offerings was, however, not disclosed.

An email query to True Balance founder and CEO Charlie Lee seeking more information did not elicit any response till the time of publishing this report.

Lee, an alumnus of the University of Chicago, founded True Balance in September 2014. The company’s India operations were launched in April 2016. The Korean entrepreneur had a previous stint in India when he led the country operations for Internet streaming media delivery firm Real Networks in 2002.

In March 2016, SoftBank Ventures Korea had invested an undisclosed amount in the company as part of its Series A round. SoftBank Ventures was established in 2000 as a subsidiary of Japanese Internet and telecom conglomerate SoftBank Group.

In February last year, True Balance raised a $15-million (Rs 100 crore) Series B round led by SoftBank Ventures. IMM Investment Group, Mega Investment, Korea Development Bank and Capston Partners also invested in that round.

The company’s latest filings indicate that its fundraising plan is significantly higher than the external funding it has raised so far. Hence, it is quite likely that the Korean parent might have raised some follow-on funding. However, VCCircle could not independently verify this.

True Balance initially operated only a mobile balance-checking app. This app allowed prepaid Android smartphone users to check their mobile and data balance, without an internet connection. It also offered recharge services. In November 2017, it had said that the Android app had recorded over 50 million downloads on Google Play Store.

In 2016-17, True Balance clocked gross revenue of Rs 57.73 lakh while income from its core operations stood at Rs 48.52 lakh. Gross expenses stood at Rs 32.66 crore. Consequently, the company registered a net loss of Rs 32.08 crore. Since the India entity was registered on April 28, 2016, the company did not file its financials for 2015-16.

In the mobile wallet segment, True Balance competes with the likes of Paytm, Mobikwik and Flipkart’s Phonepe, besides Amazon Pay. Market leaders Paytm and Mobikwik, too, had started off as mobile recharge platforms.

Subsequently, both Paytm and Mobikwik broadened the scope of their offerings to include bill payments, booking travel and movie tickets, and facilitated payments for online and offline commerce platforms. Paytm has also launched its payments bank, besides e-commerce site Paytm Mall. It counts SoftBank as its largest investor, after raising $1.4 billion from the Japanese firm last year.