Dealflow | April 30, 2018

Amazon backs Capital Float as Indian e-commerce battle heats up

Jessica Pothering
ImpactAlpha Editor

Jessica Pothering

ImpactAlpha, April 30 – The Indian fintech startup offers working capital and cashflow loans to merchants that sell goods on e-commerce sites such as Amazon and Flipkart, as well as other small businesses, who often can’t qualify for a loan with a traditional financial institution. India’s e-commerce sector is booming; Amazon is fighting to remain a leader in the market. Amazon’s online rival Walmart is reported to be close to a deal to buy India’s e-commerce giant Flipkart, offering it instant scale in an e-commerce market expected to grow to $64 billion by 2020 from $38.5 billion.

  • Small-business market… “Capital Float is bringing the right kind of credit solutions to the underserved and informally served segments of [small and medium-sized businesses] to help realize their full potential,” said Amit Agarwal, senior vice president at Amazon India.
  • Impact investor-seeded… Early funding for Bangalore-based Capital Float came from Indian impact investor Aspada, which first backed the company in 2014 with $2 million. Aspada, with funds from Soros Economic Development Fund, backed Capital Float’s subsequent Series A and B funding rounds.
  • Follow-on… Amazon invested $22 million in the most recent funding round. Earlier investors include Ribbit Capital, SAIF Partners, Sequoia India and Creation Investments. Total equity funding in Capital Float is now $107 million.