OfBusiness eyes tuck-in acquisitions, geographical expansion with $160 mn round

Gurugram headquartered OFB Tech, which owns and operates OfBusiness, is the latest business-to-business (b2b) commerce platform to enter the unicorn club, joining the likes of Moglix and Infra.Market.

OfBusiness plans to use capital from its latest $160 million (about Rs 1,190.53 crores) round for tuck-in acquisitions and joint ventures to increase its control over supply. The company facilitates raw material procurement and provides cash-flow based financing.

Now valued at $1.5 billion, the platform also aims to expand offerings to semi-finished goods, private labels and contract manufacturing, apart from adding new geographies and marketing channels. The new categories will pitch the business in competition with other incumbents including Green Oaks and Lightspeed backed Zetwerk, a manufacturing services marketplace.  

The latest round, led by SoftBank Vision Fund 2, also saw participation from returning investors Matrix Partners and Falcon Edge. TechCircle had previously reported that SoftBank, which has invested in Meesho, Swiggy, Flipkart and Whatfix, was looking to bet on OfBusiness as part of its renewed focus on India in 2021.  

Founded in 2015 by Asish Mohapatra, Ruchi Kalra, Vasant Sridhar and Bhuvan Gupta, OfBusiness helps businesses procure raw materials in several categories including metals, chemicals, polymers, agri-comodities, petrochemicals and building materials. The company also operates NBFC Oxyzo Financial Services to facilitate cash-flow based financing and tender sourcing SaaS platform, Bidassist. 

“The time for disruption in B2B commerce in traditional sectors of the economy was long overdue and has arrived. To take on the challenges of scale and uniqueness of B2B, one must be armed with teams, knowledge, technology and an ability to solve for credit needs,” Mohapatra, CEO of OfBusiness said in a statement.  

“OfBusiness has been striving to build all four across its three B2B businesses. We welcome SoftBank to the family, and we are sure we will gain significantly from their muscle across capital and international markets,” he added.

The company last raised $110 million led by Falcon Edge Capital in April this year, giving an exit to 12 angel investors and ESOP liquidation of $13 million for 73 early employees. The statement said that the company will cross the $1.1 billion revenue run rate being profitable in its commerce operations by September 2021. Oxyzo’s loan book currently stands at $220 million, with NPAs approximating 1% and 45 lenders on the platform, said the statement.

“The OfBusiness technology and finance platform improves productivity and efficiency turning them globally competitive. OfBusiness has achieved strong product market fit which is reflected in the strong growth they have seen over the last 18 months with best-in-class scale, unit economics, and we are excited to be part of this journey,” said Munish Varma, managing partner at SoftBank Investment Advisers in the statement.