Flipkart is India’s largest e-commerce company. Founded by two of Amazon’s ex-employees, Flipkart is one of the biggest e-commerce companies in the world as well. It is not as big as Amazon but it surely has taken the fight to them in India. Flipkart was founded by Binny Bansal and Sachin Bansal, both of whom are not at Flipkart anymore. It is also not an Indian company anymore, it is bought by Walmart for almost $16 billion.
That said, one of the most successful payments app in India is also owned by Flipkart. PhonePe, along with Google Pay is one of the most successful apps in India, when we talk about digital payments. The users are in millions and the only problem is that it is completely owned by Flipkart and cannot raise money on its own. It was fighting to become a separate company and that has become the case.
There are sources close to Economic Times which are chattering about PhonePe. There are rumors all around the tech world that PhonePe is getting itself a new board and is going to be released by Walmart-owned Flipkart. One of the sources who are close to ET said that PhonePe is talking to multiple investors to raise $1 billion. This money is important because the fight of the company is with Paytm which is backed by Softbank and has a huge amount of cash to burn.
“PhonePe has held talks to raise $1 billion and has been scouting the market for a while now. But now with the Flipkart board giving it a nod to become independent, the actual process of fund-raise will start. They are fighting a player like Paytm, which has the backing of SoftBank, therefore they need huge sums of capital to compete,” the source told ET.
PhonePe is an app that has partnered with UPI and is hence loved by a lot of people. That said, there are multiple investors are ready to invest in the company. Flipkart’s existing investor, Tencent is looking at PhonePe and is keen. Also, there are rumors that Binny Bansal is also looking to grab a fair share of PhonePe.
At this moment it is not clear as to how much Flipkart is ready to let go PhonePe’s 100%. It currently owns 100% of PhonePe and that is making it hard for investors to directly invest in the company. The other major factor would be that the company would get a totally new board of directors. Although it was founded by ex-Flipkart executives, Samir Nigam, Rahul Chari, and Burzin Engineer.
It was founded in 2015 and was acquired by Flipkart in 2016. Flipkart pumped in around $500 million in the company and saw it flourish. PhonePe completed around 225 million transactions in February and is looking to increase in twice in volume for three months.