Sachin Bansal, one of the country's newest billionaires courtesy his recent exit from Flipkart post its $16 billion deal with Walmart, is ready to get back to the startup world. And this time round he is reportedly going to focus on the fintech space that is growing at a five-year compounded rate of 22%, and the booming agritech sector.
Sources familiar with the Flipkart co-founder's plans told The Economic Times that he will establish a holding company through which he will directly run his new businesses as well as invest money for large minority and majority stakes in the above-mentioned sectors. Bansal has already roped in investment banker Ankit Agarwal as a partner and founding employee of this platform. Agarwal, until recently a director at Bank of America and previously with Deutsche Bank, and Bansal have known each other since their IIT-Delhi days.
"They are evaluating multiple segments as well as investments in both these areas (fintech and agriculture-technology) to understand them better. These two focus areas are where Bansal is expected to deploy a large chunk of his capital," a source told the daily, adding, "The timeline for when the (holding) company will be launched is not clear yet."
Bansal, who is believed to have made $750-760 million from the Flipkart-Walmart deal by selling his 5% stake in the company, is already in talks to invest $100 million in home-grown cab aggregator Ola and $30 million in electric scooter startup Ather Energy.
According to sources, the investment in Ola could increase to $150 million, with a portion of it going to buy New York-based investment firm Tiger Global Management's stake in the ride-hailing company apart from the primary infusion.
They added that Bansal had also held talks to invest a further $35-40 million in artificial intelligence-based healthcare venture Sigtuple, where he is already an investor, as well as an "exploratory meeting" with online insurance venture Acko, but both options fell through.
Software body NASSCOM expects the Indian fintech market to touch $2.4 billion by 2020, spurred along in part by the government's push towards a digital economy. So Bansal's interest in the space is hardly surprising. According to the Inc42 Indian Tech Startup Funding Report, fintech startups raised $631.29 million - the highest for tech startup funding - across 70 deals in the first half of the current fiscal alone.
Then, last month, Hong Kong-based hedge fund Steadview Capital announced that it had invested $30 million in IndWealth, a wealth-tech platform launched by Ashish Kashyap, who had founded travel website Ibibo. More recently, FreeCharge co-founder Kunal Shah announced the launch of Cred, a financial services platform targeting consumers having high creditworthiness. The platform raised $25 million about two months ago in a round led by Sequoia and Ribbit.
However, Bansal's interest in the agritech space is raising eyebrows. "It is a huge sector with a huge amount of problems. (But) there are quite a few areas in agriculture where startups are using software-as-a-service (SaaS), Internet of Things (IoT) solutions, and remote sensing to improve the logistics and productivity of the sector," Jinesh Shah, cofounder of agriculture sector-focused venture fund Omnivore, told the daily. He added that the number of companies that approach Omnivore for funding has jumped from just one or two a week in 2012-2013 to about 6-7 a week now.