InsurTech unicorn Groww in talks to close $250m in new investment round

Indian startup that helps millennials invest in mutual funds and stocks Groww is reportedly in talks to raise a new financing round at a $3bn valuation.

The Bangalore-based startup is negotiating to close a $250m round which could close within weeks, co-led by existing investors Tiger Global, Coatue and TCV, and Insight Partners may also be exploring the possibility of investing in the startup. Indian news outlet CapTable first reported about Groww’s upcoming financing round.

Launched in 2017 by ex-Flipkart employees Lalit Keshre, Harsh Jain, Neeraj Singh and Ishan Bansa, Groww provides users with direct plans for mutual funds investing via its mobile application and web platform. In addition, it offers stocks, ETFs, IPOs and gold provisions on its platform. Earlier this month, the InsurTech startup acquired 13-year-old Indiabulls’ mutual fund business to diversify its business offering.

India’s insurance sector appears to have seen a boom since the onset of InsurTech companies. According to Mordor Intelligence, the segment is expected to reach an approximate valuation of INR 220bn by 2024.

The startup competes with Zerodha, which recently received in-principle approval from the Securities and Exchange Board of India (SEBI) to launch its asset management company. In addition, it also competes with the likes of Paytm Money, Upstox, ETMONEY, Smallcase and other traditional brokerage and investment firms.

Groww is tapping into a huge market. More than 200 million people in India transact money digitally, but fewer than 30 million invest in mutual funds and stocks. The startup allows users to invest in mutual funds, including systematic investment planning (SIP) and equity-linked savings, gold, as well as stocks, including those listed at US exchanges. The app offers every fund that is currently available in India.

Groww is currently on track to clock about $35m in ARR. Groww, which counts Tiger Global and Sequoia Capital India among its existing investors, was valued at $1bn in April this year and $250m last September.

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