Yubi’s Valuation Surges to $1.5 Billion Following Secondary Transaction
Vivitri Capital, the parent company of Yubi, has completed a secondary transaction where it sold a portion of its shareholding to existing investors of the digital lending platform. As a result, Yubi’s valuation is now estimated to be around $1.5 billion.
Additionally, the transaction has led to a reduction in Vivitri’s stake, bringing it below the 50% mark. The details of the secondary transaction and the specific investors involved have not been disclosed publicly.
Yubi, formerly known as CredAvenue, is a digital lending platform that provides credit solutions to individuals and businesses. This development signifies investor confidence in it’s growth potential and could provide the platform with additional resources and support for its expansion plans in the digital lending space.
Yubi, the digital lending platform, achieved unicorn status in March of the previous year when its valuation reached approximately $1.3 billion. This milestone was reached after the completion of a $137 million Series B funding round led by prominent investors such as Insight Partners, Dragoneer Investment Group, and B Capital Group.
While the specific investors participating in the recent secondary transaction, which resulted in the company’s valuation standing at around $1.5 billion, have not been disclosed, it indicates continued investor interest and support in the platform’s growth and potential. The infusion of funds through the Series B round and the subsequent secondary transaction can provide Yubi with the necessary resources to enhance its digital lending services and expand its market presence.
Vivitri, was founded by Gaurav Kumar and Vineet Sukumar, who are also the co-founders of Yubi. Established in 2017, Vivitri held a significant stake in Yubi, estimated to be 50.52% according to Fintrackr’s estimates. The co-founders collectively held over 15% stake during Yubi’s unicorn round.
In regards to the recent development of Vivitri selling a portion of its shareholding to existing investors, Yubi declined to comment on the matter. The transaction has resulted in Vivitri’s stake in Yubi falling below 50%, indicating a potential reshuffling of ownership and the involvement of existing investors in the platform’s growth and plans.
Yubi is reportedly in the final stages of hiving off from its parent company, Vivitri. The restructuring process, which began almost a year ago, aims to separate the lending platform from the NBFC (Non-Banking Financial Company) entity. The process is now nearing completion, as per the report.
While it has not disclosed its financials for FY23, its operating revenue for FY22 experienced a significant increase, surging 6 times to Rs 153 crore from nearly Rs 25 crore in FY21. However, the company also saw its losses grow 8.3 times to Rs 55.3 crore in FY22 from Rs 6.65 crore in FY21, based on Fintrackr’s analysis.
The separation of Yubi and Vivitri is expected to enable a more focused approach for both entities and potentially unlock new growth opportunities in the digital lending space.
According to Yubi’s CEO, Gaurav Kumar, the company achieved a significant milestone by closing the last fiscal year, FY23, with a topline of Rs 300 crore. This represents a remarkable 100% growth compared to the previous year. The strong revenue growth indicates Yubi’s success in the digital lending space and its ability to capture market opportunities.
The company stands out as one of the few growth-stage startups that have experienced a secondary transaction during a challenging funding environment. Another example is logistics firm XpressBees, which announced a $40 million secondary round in April. Before that, XpressBees facilitated a $25 million secondary transaction in August 2022.
These secondary transactions indicate the interest of existing investors in increasing their stakes or providing liquidity to early investors or employees. Despite the funding challenges faced by the startup ecosystem, such secondary transactions demonstrate confidence in the long-term potential and growth prospects of these companies.
