Zeta, a banking tech unicorn, has stitched a five-year old global partnership with Mastercard to power credit processing for banks and fintech companies and has also received financial investment from the American payment cards firm.
Bhavin Turakhia, Founder, Zeta, told VCCircle that the company received financial investment of $30 million from Mastercard and an unidentified fund from the Middle East and North Africa (MENA) region as part of this transaction.
The latest capital infusion comes after Zeta raised $250 million led by SoftBank Group Corp’s Vision Fund 2 at a valuation of $1.45 billion in May last year. That funding round had turned the startup into a unicorn, or private companies with a valuation of at least $1 billion.
Turakhia added that the investment from Mastercard happened at the same valuation as the Softbank-led round.
In a separate statement, Zeta said that as part of the five-year partnership with Mastercard, the two firms will go-to-market jointly to launch credit cards with issuers globally on Zeta’s modern, cloud-native, and fully API-ready credit processing stack.
"By deploying Zeta’s credit processing stack, issuers will have an opportunity to grow their user base, drive higher usage and enter new geographical markets, all while accelerating the cashless revolution around the world,” said Sandeep Malhotra, Executive Vice President, Products and Innovation, Asia Pacific, Mastercard, in the statement.
For Turakhia, who founded Zeta in 2015 with Ramki Gaddipati, the investments from SoftBank last year and Sodexo earlier marked a departure from his preference for bootstrapping his businesses. Zeta was initially internally funded by Directi, founded by brothers Bhavin and Divyank Turakhia. The Mumbai born Turakhia brothers sold Directi’s web presence business for a reported $160 million in 2013 to Nasdaq-listed Endurance Group. Later, in 2016, Divyank Turakhia sold his ad-tech company Media.net to a consortium of Chinese firms for $900 million.
Zeta started out as a meal voucher product for employees and later pivoted to a neobanking and banking technology provider.
Zeta currenlty has more than 1300 employees with over 70% in technology roles across locations in the US, UK, Middle East, and Asia. Globally, eight issuers and 30 fintech companies have issued more than 10 million cards on Zeta’s platform.
Turakhia also said that Zeta sees most of its revenue coming from North America going forward even as it will continue to grow its India business. He also said that the company does not plan to make any acquisitions in the next two to three years.
