Razorpay Becomes India’s Latest Unicorn After $100 Million Fundraise

Many of India’s businesses are struggling to get back to their feet after the coronavirus lockdowns, but others haven’t missed a beat.

Online payments provider Razorpay has become India’s latest unicorn after a $100 million fundraise. GIC, Singapore’s sovereign wealth fund, along with Sequoia and existing investors Ribbit Capital, Tiger Global, Y-Combinator and Matrix Partners participated in the fundraise. Razorpay was founded in December 2014 to accept, process and disburse online payments.

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“Five years ago, when Harshil & I moved to Bangalore to start Razorpay, the startup ecosystem was still nascent and less than a decade old.” wrote Razorpay co-founder Shashank Kumar in a blogpost. Shashank Kumar and Harshil Mathur had met at IIT Roorkee, and had realized that it was very hard for small businesses to process digital payments. In their early days, the founders worked with a team of 11 out of a single apartment, and struggled to get banks to work with the young company. The company had eventually raised funding, become the 2nd ever Indian company to be a part of the prestigious Y Combinator program, and moved into some smart digs.

Things have changed considerably since then. The demonetization exercise of 2016 gave a massive fillip to online payment firms in India, and Razorpay was perfectly poised to take advantage. Razorpay now counts Oyo, Airtel, Facebook, Flipkart, Zomato, Swiggy, Byju’s, Yatra and GoIbibo as clients, and processes payments of $25 billion per year. Its payment volumes have grown 5x over the last year, and it has 10 million customers.

Razorpay is also experimenting with new products. It has launched something called Payment Button, that claims to enable small businesses to start receiving payments on their website in less than 5 minutes. Razorpay has also launched its neobank product called Razorpay X, which provides small businesses with a singular hub for all financial operations. Razorpay says that Razorpay X has served 10,000 businesses within 12 months of its launch.

And Razorpay seems optimistic about the future. “Despite the tremendous growth we’re witnessing in the digital payments ecosystem, online payments still barely account for a meagre 3% of Indian economy,” wrote Shashank Kumar.  “I strongly believe that in India’s journey towards achieving the $5 trillion GDP target by 2024, digitization of the economy and Indian businesses is not just a nice-to-have but rather a strong force multiplier. So yes, there’s  a long way to go,” he added.

Quora Has Just Raised Rs. 550 Crore And Become A Unicorn

When one thinks of social networks, Quora isn’t the first name that comes to mind. The company doesn’t believe in much publicity, and its founders prefer to maintain a low profile. But Quora is surprisingly large – with 190 million unique monthly users, it isn’t quite in the rarified billion user space that Facebook and Instagram occupy, but it’s seriously big. And now the company is raised more money, and in the process, become a unicorn.

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Quora has raised $85 million (Rs. 550 crore) in a round led by Y Combinator’s Sam Altman, on behalf of the Y Combinator Continuity and Collaborative Fund. Previously, Quora had raised $235 million from investors such as Tiger Global, Matrix Partners, Peter Thiel and Facebook co-founder Dustin Moskovitz. 

Quora cofounder and CEO Adam D’Angelo is a Facebook alumnus himself — before founding Quora in 2009, D’Angelo was the CTO of Facebook. Quora’s core mission had been to try to get knowledge onto the internet that’s not already available. Over the years, Quora has managed to garner a dedicated userbase that also has the reputation of being knowledgeable and helpful. India, incidentally, is one of its biggest markets, with the site being popular among India’s urban youth.

Quora now wants to expand internationally into languages other than English. In August last year, Quora had launched a Spanish version of the site, and a few weeks ago, has launched a French version. Quora now uses IP addresses to guess which language new users would prefer, and automatically switches to it. D’Angelo feels that translating Quora will be a big step in democratizing information online. “The English ecosystem on the internet is very strong, as there are various blogs and forums out there,” he said. “When you go into some of these other languages, however, there’s really not as much.” Going forward, Quora wants to launch in Italian and German. 

The move to new languages doesn’t seem to have taken place because user growth had stalled, as it is for some companies. Quora’s monthly active users doubled over the past year, but Quora insists it has always emphasized on quality over quantity. Unlike other social networks, Quora can boast of several celebrity users — prominent personalities across different fields — who take time out to write detailed answers on the website. Quora also implements a policy that ensures that people use their real names while using the site.

Quora plans to use the new funding money to build its ad network, and hire machine learning engineers who’ll work on personalizing the content that its users see. And whatever it’s doing, the investors seem to be happy — Quora says its valuation has nearly doubled in this fundraise from $900 million previously, meaning Quora is now in the hallowed list of startups that are valued at over $1 billion.

Next on the company’s list of plans is a possible IPO. “Our goal is to be a long-term, independent company,” said D’Angelo. “We expect that we will go public at some point.”