Companies

WeRize raises $8 million in Series A funding

Our Bureau Bengaluru | Updated on September 08, 2021

The firm plans to reach 4,000+ towns in the next two years through its social distribution ‘Social Shopify of Finance’ tech platform

 

Small towns-focused fintech start-up WeRize has raised $8 million Series A funding round led by 3one4 Capital, Picus Capital, Kalaari Capital, and Orios Ventures.

Founded by ex LendingKart executives Vishal Chopra and Himanshu Gupta in 2019, WeRize is building a socially distributed full-stack financial services platform for families in small town India. The financial needs of small town India have been largely ignored by incumbent players and fintechs who primarily focus on millennials in urban India.

WeRize is already operationally profitable and aims to become EBITDA positive by early 2022. It has registered 10x revenue growth in the last year. The company currently caters to customers in 1,000+ cities and towns and plans to reach 4,000+ towns in the next two years through its social distribution ‘Social Shopify of Finance’ tech platform that will have over 50,000 freelance financial consultants across India.

WeRize is a full stack provider, both developing and distributing a portfolio of customised credit, group insurance and savings products for 100 million families and 300 million individuals who live in over 4,000 small towns of India. This $200 billion and growing annual market expects a very different product set as well as distribution model which traditional private banks, insurers, and mutual fund companies are unable to provide. The economics of these products as well as operation in small cities is not feasible for traditional companies due to their high-cost branch-based distribution model.

Designed for small towns

Indian families in small towns primarily bank with government or regional cooperative banks that only provide a basic bank account and don’t provide other financial products such as unsecured loans, credit cards, insurances or investments. Providing access to a broader set of products in this demography calls for a more differentiated and deeper risk management capability. Small town India lives in joint families and tend to have a single P&L for the family. WeRize has used this insight to develop financial products with entire families (and not individuals) in mind.

Social distribution has so far allowed WeRize to collect over 1 billion data points across 5,00,000 families in 1,000 cities. WeRize has used insights from these data points to create customised credit, group insurance, and savings products that serve the unique needs of these families. The social distribution model has also resulted in significantly lower customer acquisition cost (no branches or employees in these small cities) and helped WeRize build a sustainable business serving small town India.

Vishal Chopra and Himanshu Gupta, co-founders, WeRize said, “We are creating a new category in the Indian financial services space; a socially distributed full stack financial services platform for 4,000+ small towns of India. The full stack approach of owning both the product and the distribution gives us unique insights about our customer segment that becomes a competitive advantage.”

Anurag Ramdasan, Partner at 3one4 Capital said, “Financial services for 4,000+ small towns in India is a space that has been largely untouched due to the complex nature of the space. Vishal and Himanshu have been working on this space for two years to build a lean, efficient approach to solving the problem for 300 million Indians. We strongly believe that their approach of designing financial products focused on families along with distributing through social model is the only way to win this huge market.”

Rajesh Raju, Managing Partner at Kalaari Capital said: “Vishal and Himanshu bring to the table all the necessary know-how and experience to build India’s first socially distributed full stack financial services brand for families in small town India . Small town India needs a very different set of products than is currently made available by incumbent players and a distribution model that solves the unique challenges that exist in these markets. ”

Published on September 08, 2021

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