When three Arthur Andersen LLP consultants wanted to start a digital payments company around the turn of the millennium, they became the first institutional financiers to find an Indian government lender. This week Prosus NV bought BillDesk for $ 4.7 billion and made them $ 0.5 billion each for their combined 31% stake.The story of MN Srinivasu, Ajay Kaushal, and Karthik Ganapathy violates the rules of the Indian Starter Handbook.
At a time when every fundraiser is touted in press releases and employee parties, Prosus-owned PayU had to take over the takeover announcement because BillDesk had never employed a PR firm before.“We aren’t the typical young startup founders," Srinivasu said by phone, hastening to add that while Kaushal and he are 53 years old, Ganapathy is “only pushing 50." “When we started on Jan. 1, 2000, we didn’t have a startup idea.
We thought it would be a great opportunity to build something at the intersection of tech and financial services, it was just gut-feel."Although the trio have sold all of their shares, they will continue to be part of the company, Srinivasu said without comment. The deal with Prosus could intensify competition in India's vibrant fintech industry, where it sees huge potential for economies of scale, as "anyone can move $ 100 million or $ 0.05 practically for free in seconds ".The founders met while working in financial services at Arthur Andersen and resigned in 1999, just a few years before the accounting giant collapsed after the Enron Corp scandal. in 2002. Allen graduated from the 1st Indian Institute of Management in India and left his so-called successful careers to become entrepreneurs with little savings.
BillDesk's first financier was the Bank of Baroda and a fund managed by the financier Small Industries Development Bank of India, both state-owned and counterpart to the world's leading venture capital firms. It will be over a decade and a half before major investors such as Temasek Holdings Pte, Visa Inc. and General Atlantic LLC join us. By this time, BillDesk had created a global customer list and provided the gateway to millions of customers making payments through Amazon.com Inc. in India. or Microsoft Corp.'s LinkedIn service, Netflix Inc. subscriptions purchased or traded at Apple Inc.'s local online store. BillDesk began pricing an IPO and hiring investment bankers this year. Then, a few weeks ago, Prosus took the stage and proposed a 100% takeover.
The appeal was clear: More than 800 million Indians use the Internet, and e-commerce is expected to increase as China takes hold of its tech industry.BillDesk started when the internet user base in India was around 50,000. On the one hand, the company's tech pipe collected billing data from utilities such as electricity and utilities, water, and telephone. On the other hand, it collected paper money orders from bank customers to debit payments to these utilities from their accounts. It turned out to be a robust system. Customers no longer had to queue to pay their bills.
Government actors didn't have to spend millions of hours coordinating banking transactions. And banks didn't have to process physical payments when customers logged into their offices. The explosive growth of digital payment via the ubiquitous internet access via smartphones has given BillDesk a boost. It now makes all types of payments easier, from insurance and property taxes to recurring payments like mutual funds, credit card payments, and tuition.“We were the payments solution that stayed in the background, allowing banks to brand and operate our solution," Srinivasu said. “We steered clear of the grow-big-at-any-cost fintech model."
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