Jaipur-based non-bank lender Finova Capital has raised $135 million (Rs 1,135 crore) in its Series E funding round from Avataar Venture Partners, Sofina, and Madison India Capital, with existing investor Norwest Venture Partners also participating in the round.
The transaction also provides a partial exit to early investors. It, however, didn’t disclose the names of investors who left the captable. Its early investors include Peak XV Partners, Faering Capital, and Maj Invest.
Finova plans to use the funds to grow its loan book, invest in technology, expand geographically, and further its vision of enabling financial inclusion at scale.
Founded in 2015 by Mohit Sahney and Sunita Sahney, Finova Capital provides lending products that targets micro-entrepreneurs and semi-skilled professionals, who typically do not have or have limited access to lending from formal financing institutions.
“...the entire team has demonstrated tremendous execution capabilities to build a technology-driven platform which is highly profitable and has grown 7x in the last 4 years driven by strong underwriting and origination capabilities,” said Anirudh Singh, partner at Avataar Venture Partners.
The company claims that it has been profitable since its first year of operations. It has a presence across 16 states with more than 400 branches. It has served more than 1 lakh customers. The current AUM of the company stands at around Rs 3,000 crore and has grown with a 5-year CAGR of more than 60%.
The company had last raised $65 million in March 2022 in a funding round led by Norwest, along with participation from Maj Invest and Faering Capital.
“...Since our initial investment in 2022, Finova has transformed into a multi-geography financial institution, achieving a threefold AUM growth through strategic investments in people, technology, and infrastructure,” said Niren Shah, managing director and head of India at Norwest.
Bengaluru-based Unitus Capital acted as the exclusive financial transaction advisor to Finova.