Lightspeed-backed fintech platform Setu raises $15 mn in Series A round

Bengaluru headquartered BrokenTusk Technologies, which owns fintech platform Setu, has raised $15 million (around Rs 110 crore) in a Series A round led by returning investor Lightspeed Venture Partners. 

Another returning investor Bharat Inclusion Seed Fund, a venture capital fund managed by CIIE Initiatives, and new investor Falcon Edge Capital also participated in the round, according to filings with the Ministry of Corporate Affairs. 

While Montreal headquartered Lightspeed infused $8.1 million through its two entities Lightspeed India Partners and Lightspeed Venture Partners US, New York-based Falcon Edge Capital invested $5.5 million and Ahmedabad-based Bharat Inclusion Seed Fund put in the rest, the regulatory filings showed.

The company issued a total of 5,544 Series A preference shares at Rs 208,161.38 per share to the investors, the filings showed.

With the fresh capital, the company will hire employees to add to its current strength of 30, Nikhil Kumar, co-founder of Setu, said in a separate statement.

A year ago, the company raised $3.5 million (Rs 24.5 crore) in a seed funding round led by Lightspeed India Partners and Bharat Inclusion Seed Fund.

Kumar set up the platform in 2018 with Sahil Kini. It provides application program interface (API) infrastructure that connects regulated financial institutions to companies that other firms that offer financial services. Additionally, a developer can access its sandbox to build an application across verticals such as payments, credit and account aggregation using its open source software D91 Labs, as per the website.

Kini, a IIT Madras alumnus, has worked at venture capital firm Aspada Investments and digital database initiative IndiaStack. Kumar was a fellow at the Indian Software Product Industry Roundtable (iSPIRT) Foundation. 

“Setu can drive the sachetisation of the traditional financial product while enabling traditional public and private lenders to reach a wider cross-section of India in a digitally enhanced manner,” Navroz Udwadia, managing partner of Falcon Edge Capital, said.  

Despite a dip in overall startup funding on account of Covid-19, fintech firms evinced some investor interest this month. 

Coverfox raised $2.1 million from its parent company Glitterbug Technologies. 

Working capital lender for small and medium enterprises (SMEs) Capital Float raised $15 million in an equity capital round from returning investors Ribbit Capital, Amazon, SAIF Partners and Sequoia Capital India.

Gurugram-based non-banking financial company (NBFC) Aye Finance raised $23.8 million in debt from lenders in India and abroad.