Deepak Shenoy

All roads to monetization in fintech lead to lending, that's where the profit pools lie. "Fintech is not dead," Akshay Sarma who's spent the last 9 years building axio (formerly Capital Float (now axio)), one of India's most valuable fintech companies. Watch here: https://lnkd.in/gvHqB4zM We've talked about all things Fintech: > The Landscape of the Fintech Ecosystem, opportunities, and different business models > How Axio evolved from MSME lending to consumer lending post the pandemic > Are the regulators (RBI & SEBI) unsupportive of Indian fintech companies? > How should fintech founders navigate the tough fundraising environment? > Public markets, investing in equity vs debt Akshay's personal investing strategy > The High-Risk, High-Reward Nature of Angel Investing > Do you need a NBFC license to succeed as a fintech company? > The Frenzy Around SME IPOs and Risk Appetite > The Importance of Profitability and Cost of Funds in Determining Margins Must watch for all fintech founders and investors in the country!

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The Securities and Exchange Board of India (Sebi) has introduced new rules that streamline the process for companies, particularly new-age tech startups, to go public by relaxing the minimum promoter contribution requirements in IPOs. Previously, companies applying for an IPO had to ensure that promoters contribute a minimum of 20% of the post-offer equity share capital. This would prove challenging for new-age tech companies whose founders often dilute their stake through multiple funding rounds before going public. The new regulations introduced by Sebi address this issue by: 𝐀𝐥𝐥𝐨𝐰𝐢𝐧𝐠 𝐧𝐨𝐧-𝐩𝐫𝐨𝐦𝐨𝐭𝐞𝐫 𝐬𝐡𝐚𝐫𝐞𝐡𝐨𝐥𝐝𝐞𝐫𝐬 𝐭𝐨 𝐜𝐨𝐧𝐭𝐫𝐢𝐛𝐮𝐭𝐞 𝐭𝐨𝐰𝐚𝐫𝐝𝐬 𝐭𝐡𝐞 𝐦𝐢𝐧𝐢𝐦𝐮𝐦 𝐩𝐫𝐨𝐦𝐨𝐭𝐞𝐫 𝐜𝐨𝐧𝐭𝐫𝐢𝐛𝐮𝐭𝐢𝐨𝐧 𝐬𝐡𝐨𝐫𝐭𝐟𝐚𝐥𝐥. This provides companies with more flexibility in meeting the listing requirements. However, it's important to note that these non-promoter shareholders must hold more than 5% of the post-offer equity share capital and will not be classified as promoters themselves. 𝐂𝐨𝐧𝐬𝐢𝐝𝐞𝐫𝐢𝐧𝐠 𝐞𝐪𝐮𝐢𝐭𝐲 𝐬𝐡𝐚𝐫𝐞𝐬 𝐟𝐫𝐨𝐦 𝐜𝐨𝐦𝐩𝐮𝐥𝐬𝐨𝐫𝐢𝐥𝐲 𝐜𝐨𝐧𝐯𝐞𝐫𝐭𝐢𝐛𝐥𝐞 𝐢𝐧𝐬𝐭𝐫𝐮𝐦𝐞𝐧𝐭𝐬 (𝐂𝐂𝐈𝐬) 𝐭𝐨𝐰𝐚𝐫𝐝𝐬 𝐭𝐡𝐞 𝐦𝐢𝐧𝐢𝐦𝐮𝐦 𝐩𝐫𝐨𝐦𝐨𝐭𝐞𝐫 𝐜𝐨𝐧𝐭𝐫𝐢𝐛𝐮𝐭𝐢𝐨𝐧. CCIs are instruments that convert into equity shares after a certain period or upon the occurrence of a specific event. Previously these instruments could not be used to meet the minimum promoter contribution requirement. Under the new rules, equity shares resulting from the conversion of CCIs held by promoters for at least one year before filing the draft red herring prospectus (DRHP) can be counted towards the minimum promoter contribution. While the minimum promoter contribution requirement remains at 20%, these changes by Sebi provide new-age tech startups with additional avenues to meet this threshold. This can potentially lead to a surge in IPOs from these companies and increased investment opportunities in the Indian stock market. Here are some additional points to consider: ✅ Promoters are still required to hold at least 10% of the post-issue capital, ensuring they retain a vested interest in the company's long-term success. ✅ The lock-in period for promoters' shares remains in place, requiring at least 20% of promoters' shares to be locked in for a certain period after the IPO listing. This instills investor confidence by demonstrating the promoters' commitment to the company. #Startups #InvestmentBanking #ipo #CapitalMarkets

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Generative AI-powered speech and text analytics startup GreyLabs AI has raised $1.5 Mn (around INR 12.5 Cr) as part of its seed funding round led by Matrix Partners India. The round also saw participation from a host of founders, including Vasant Sridhar (OfBusiness), Narasimha Reddy (MoEngage), Nitin Gupta (Uni Cards) and Anil Goteti (Scapia Cards) among others. The Mumbai-based startup plans to use the fresh capital to strengthen its tech stack, expand its geographical footprint and scale its team, founder and CEO Aman Goel told Inc42. Founded in 2023 by Goel and Harshita Srivastava, GreyLabs AI leverages large language models (LLMs) to help businesses drive their sales, automate audits of calls of call centre and call quality assurance processes. The company claims its AI-powered speech-to-text engine can extract insights from an organisation’s customer interactions and email communications with a near-human level accuracy. GreyLabs AI will also use a portion of the proceeds to add support for more than 10 languages on its platform. Currently, it supports only English, Hindi and Gujarati. “The volume of unstructured data generated within enterprises is enormous. With recent advancements in Generative AI, we can now accurately analyse this data and transform it into …

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Continuing on the question of what themes have driven India SaaS over the last decade: one of the themes has been the me-too model in SaaS - this has been a majority of early-stage financings historically in India. I think starting a new company today with this model may be tough, given rise in keyword costs and intense competitive clutter. The model has assumed: - target a large, mature market - build 60-80% of functionality (or pick off a part of the workflow) with some technical innovation - offer at a fraction of the price of the market leader - target SMB first, then work your way up to lower mid-market - aggressive GTM through SEO, SEM, self-service and remote sales - differentiate through price and support - category leadership is not the goal - 10 years to $100mm ARR (if successful)- which is ok-ok growth rate, not top quartile

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