Lightspeed may invest in Razorpay’s $100 million secondary share sale.
- ByStartupStory | April 22, 2022
According to sources briefed on the situation, Razorpay is putting together an $80-100 million secondary share sale deal, in which new investors such as Lightspeed Venture Partners will join the company’s cap table. The secondary deal is expected to finalize in the coming weeks for Bengaluru-based Razorpay, which was valued at $7.5 billion after a $375 million investment round in December last year.
Angel investors, workers, and possibly another investor are selling shares in what could be the company’s largest secondary sale since its inception. New investors buy shares from existing investors in a secondary share sale, but the money does not go to the company. Razorpay’s founders may also sell a tiny portion of their stock, but this hasn’t been finalized yet, according to sources.
The deal may be performed at a little lower valuation than Razorpay’s last-round price, as is typical of secondary transactions. “Some of the incoming investors wanted to join in the December round but were unable to do so; as a result, secondaries are being used,” one of the people briefed on the situation said. Harshil Mathur, Razorpay’s creator, and CEO declined to comment, while an email sent to Lightspeed Venture Partners went unanswered.
The exact magnitude of the transaction, according to sources, will be determined by how much Razorpay staff is ready to sell. Razorpay’s valuation soared two-and-a-half times in eight months when the company concluded its previous funding round in December, so the secondary sale might result in a large profit for existing investors. Founded by Mathur and Shashank Kumar in 2014, Razorpay is one of the highest-valued Indian fintech startups in India. GIC, Tiger Global, Sequoia Capital, and other investors have contributed roughly $740 million to the company.
Razorpay also makes acquisitions in India and overseas, the most recent of which was in March with the purchase of IZealiant Technologies. Curlec, a Malaysian fintech business, was bought by it in February. In the calendar year 2021, Razorpay had a total payment volume (TPV) of $60 billion, intending to reach $90 billion by the end of 2022.
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