Sep 11, 2023

Want this newsletter delivered to your inbox? SUBSCRIBE Thank you for subscribing to Daily Top 5 We'll soon meet in your inbox. Byju's has begun selling its group assets as it puts Epic and Great Learning on the block to generate $800 million-$1 billion in cash. This and more in today’s ETtech Top 5. Also in this letter: ■ Yatra Online to flag off IPO on September 15 ■ Digital lending disbursement volume rose 31% in Q1 FY24: Report Byju’s puts Epic, Great Learning on the block for $800 million to $1 billion Troubled edtech company Byju’s plans to sell two of its prized assets – Epic and Great Learning – to generate $800 million-$1 billion in cash. Driving the news: Byju’s has proposed to clear a $1.2 billion Term loan B to its lenders, and the sale is part of its plans to meet this commitment, among others, people in the know said. Bloomberg first reported that Byju’s proposed to pay back its entire $1.2 billion term loan in less than six months. What else is happening? Byju’s key assets have garnered some interest in the market, sources told us, adding that the company is also in talks to raise fresh equity capital. The company is expecting to raise $400-$500 million from the sale of Epic, a US-based kids’ learning company it acquired in a $500 million cash-and-stock deal in July 2021. A further $500-$600 million is also expected from the sale of higher education and upskilling firm Great Learning. Perfios raises $229 million from Kedaara Capital in primary, secondary mix Sabyasachi Goswami, CEO, Perfios Deal deets: Perfios said the capital raise, a combination of a primary and secondary share sale, will be used to fuel the company’s expansion across North America and Europe. Jargon buster: In a secondary share sale, existing investors sell their shares to new investors in part or full. Thus, the money does not go into company coffers. What does Perfios do? The Bengaluru-headquartered firm offers a software technology platform to over 1,000 financial institutions across 18 countries, helping them extract, aggregate and analyse financial data to improve credit assessment. Perfios has over 75 platforms and products to help with onboarding, underwriting and monitoring, among other processes. It processes 1.7 billion transactions a year. Investorspeak: “We look forward to using our operational expertise and deep connectivity in the financial services and technology spaces to help support the company in this next phase of its growth journey,” said Kartikeya Kaji, managing director, Kedaara Capital. Other backers: Bessemer Venture Partners joined the company’s cap table in 2017 during its Series A round, while Warburg Pincus joined in 2019 during Series B. The latest round of funding is Series D. ETSA 2023 | What the high-powered ETSA jury expects from nominees From left: Arjun Sethi, cofounder Tribe Capital, and Satyan Gajwani, vice chairman, Times Internet In the run-up to the Economic Times Startup Awards 2023 jury meeting tomorrow, elite jury members Arjun Sethi, cofounder, Tribe Capital, and Satyan Gajwani, vice chairman, Times Internet, share their views on what makes a winner stand out . Gajwani said key metrics include a demonstrated path to profitability and the use of innovative technology. “We’ll be looking out for companies that fit a few potential bills: (a) a higher orientation towards profitability and viable business models, (b) innovative uses of AI technology, and (c) deep-tech work that is hard to replicate and that can have an impact on a global scale.” Sethi of Tribe Capital, will judge the nominees on the scalability of their business models. “I’m interested in how the founders think about scaling up their businesses and how they balance growth and monetisation,” he said. Nominees for Startup of The Year 2023 The winner of this category will be characterised by breakthrough innovation, top-class execution and fast-paced growth. The quality of the founding and management team will also be an important component in decision-making. And the nominees are… Yatra Online to flag off IPO on September 15 Gurugram-headquartered Yatra Online Ltd will open its initial public offering (IPO ) for public participation on September 15. The company filed its draft red herring prospectus with the market regulator on March 24 last year. Details: The IPO comprises a fresh issue of shares worth Rs 602 crore and an offer for sale of up to 12,183,099 shares by existing shareholders. Three-quarters of the shares will be available for allocation to qualified institutional bidders, while 15% will be offered to non-institutional investors, and 10% to retail investors. The issue of fresh shares at Rs 602 crore is lower than the originally envisaged Rs 750 crore, and includes a pre-IPO placement of about Rs 62 crore under a rights offer issued to one of its promoters, THCL, at Rs 236 a share. Strategic investments: The company plans to use Rs 150 crore from the proceeds for strategic investments, acquisitions, and inorganic growth. Also, Rs 392 crore for customer acquisition and retention, technology, and other organic growth initiatives, as well as for other general corporate purposes. Key numbers: In fiscal year 2023, the company’s revenue increased to Rs 380 crore from Rs 198 crore the previous year and Rs 125 crore in FY21, boosted by the recovery of the economy and rebound in travel and tourism after the pandemic. Earnings before interest, tax, depreciation, and amortisation, or operating profit, rose to Rs 51 crore in the year ended March 31, 2023, from Rs 4 crore the previous year. The company had posted an operating loss of Rs 56.98 crore in FY21. Digital lending disbursement volume rose 31% in Q1 FY24: Report Digital lending picked up at a stellar pace in the first quarter of the financial year (Q1 FY24), with volumes recording annual growth of 31%, while value rose 32%, according to a report by the Fintech Association for Consumer Empowerment (FACE). Details: According to the association’s report, member companies disbursed 2.2 crore loans during Q1 FY24, up 31% from Q1 FY23 and a 16% increase over the previous quarter. Meanwhile, disbursement value increased 32% in Q1 FY24 from the same period last year to reach Rs 29,875 crore, as against Rs 22,682 crore last year. Average ticket size: The average ticket size in Q1 FY24 stood at Rs 11,043, though there is considerable variation across companies. Three-fourths of the companies reported positive annual growth over the comparable quarter in FY23, the report said. Today’s ETtech Top 5 newsletter was curated by Megha Mishra in Mumbai and Erick Massey in New Delhi.